Question

The International Monetary Fund is trying to raise $700 billion in 9 years for new funds to lend to developing countries. Al 12% Interest compounded quarterly, how much must it invest today to reach $700 billion in 9 years? (Use the Table provided.) (Do not round intermediate calculations. Enter your answer in billions of dollar rounded to 2 decimal places.) Present Value billion

Answer 1

The answer has been presented in the supporting sheet. All the parts has been solved with detailed explanation and format. For detailed answer refer to the supporting sheet.

Answer 3 In the given question we have to calculate the present Value 5 6 7 8 Present value = Future Value*(1/(1+i)^n) = 700*(1/(1+3%)^36) = 700*.3450 = $ 241.5 LO Thus the correct answer 11 Present value $241.50 13 Note = 1 = (12%/4) 14 n= 19*4) 15