Concept explainers
a.
To Determine: The
a.
Answer to Problem 10P
The future value compounded for 10 years is $895.42.
Explanation of Solution
Determine the future value compounded for 10 years using formula
Therefore, the future value compounded for 10 years using formula is $895.42.
Determine the future value compounded for 10 years using excel
Excel Spreadsheet:
Therefore, the future value compounded for 10 years using excel is $895.42.
b.
To Determine: The future value compounded for 2 years.
b.
Answer to Problem 10P
The future value compounded for 2 years is $1,552.92.
Explanation of Solution
Determine the future value compounded for 2 years using formula
Therefore, the future value compounded for 2 years using formula is $1,552.92.
Determine the future value compounded for 2 years using excel
Excel Spreadsheet:
Therefore, the future value compounded for 2 year using excel is $1,552.92.
c.
To Determine: The present value of due in 1 year.
c.
Answer to Problem 10P
The present value of due in 1 year is $279.20.
Explanation of Solution
Determine the present value of due in 1 year using formula
Therefore, the present value of due in 1 year is $279.20.
Determine the present value of due in 1 year using excel
Excel Spreadsheet:
Therefore, the present value of due in 1 year using excel is $279.20.
d.
To Determine: The present value of due in 2 years.
d.
Answer to Problem 10P
The present value of due in 2 years is $160.99.
Explanation of Solution
Determine the present value of due in 2 years using formula
Therefore, the present value of due in 2 years is $160.99.
Determine the present value of due in 2 years using excel
Excel Spreadsheet:
Therefore, the present value of due in 2 years using excel is $160.99.
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Chapter 4 Solutions
Corporate Finance: A Focused Approach (mindtap Course List)
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- In this project, you will use a graphing calculator to compare savings plans. For instance, suppose you are depositing $1000 in a savings account and are given the following options: 4 • 6.2% annual interest rate, compounded annually 6.1% annual interest rate, compounded quarterly 6.0% annual interest rate, compounded continuously •arrow_forward不 a. Use the appropriate formula to determine the periodic deposit. b. How much of the financial goal comes from deposits and how much comes from interest? Periodic Deposit Rate Time Financial Goal $? at the end of each year 3% compounded annually 15 years $130,000 Click the icon to view some finance formulas. a. The periodic deposit is $ (Do not round until the final answer. Then round up to the nearest dollar as needed.) this View an example Get more help 4 Clear all Checarrow_forwardComplete the following using the future value formula or financial calculator. (Do not round intermediate calculations. Round your final answers to the nearest cent.) Time = 4 years Principal = $3,300 Rate = 8% Compounded = Quarterly What is the amount and interest?arrow_forward
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