Question

Solve various time value of money scenarios. Click the icon to view the scenarios) (Click the icon to view the present value of $1 table.) (Click the icon to view the future value of $1 table) (Click the icon to view the present value of annuity of $1 table) (Click the icon to view the future value of annuity of $1 table.) Scenario 1. Eddie just hit the jackpot in Las Vegas and won $45,0001 If he invests it now at a 10% interest rate how much will it be worth in 15 years? (Round your answer to the nearest whole dollar) Future value=$ Scenario 2. Alan would like to have $2,500,000 saved by the time he retires in 40 years. How much does he need to invest now at a 14% interest rate to fund his retirement goal? (Round your answer to the nearest whole dollar) Present value = $ Scenario 3. Assume that Tina accumulates savings of $1.5 million by the time she retires. If she invests this savings at 8%, how much money will she be able to withdraw at the end of each year for 15 years? (Round your answer to the nearest whole dollar and enter as a positive amount) Amount able to withdraw = $ Scenario 4. Faith plans to invest $4,000 at the end of each year for the next eight years. Assuming a 12% interest rate, what will her investment be worth eight years from now? (Round your answer to the nearest whole dollar) Future value=$ Scenario 5. Assuming a 10% interest rate, how much would Sarah have to invest now to be able to withdraw $13,000 at the end of every Enter any number in the edit fields and then continue to the next question. O I e a 8 9 hp

need help on this question please i'm really confused and stuck

Answer 1

Ans.

1. Present value=15000, time=15 and r=10%

Future value=15000(1.1)^15

Future value= 15000*4.177

=62655

2. Future value=2500000

Present value= 2500000/(1.14)^40

=2500000*0. 005

12500

3.present value of annuity=1500000

P.v factor=8.559

Annuity=1500000/8.559

Annuity=175254

4.A annuity=4000

Future value factor=12.30

Future value=4000*12.3

=49200