1. Sarah aims to acquire, in 8 years, a special gadget priced today at 300 units in the local currency, with its cost rising by 6% annually due to market trends. To save for this, she plans to deposit 25 units into a savings account at the start of each of the initial 5 years. Additionally, she intends to contribute an unspecified amount, denoted as Y, at the end of the 3rd and 4th years to reach her goal. Her savings account offers a 12% annual equivalent rate. What is the value of Y needed to achieve her goal?

1. Sarah aims to acquire, in 8 years, a special gadget priced today at 300 units in the local currency, with its cost rising by 6% annually due to market trends. To save for this, she plans to deposit 25 units into a savings account at the start of each of the initial 5 years. Additionally, she intends to contribute an unspecified amount, denoted as Y, at the end of the 3rd and 4th years to reach her goal. Her savings account offers a 12% annual equivalent rate. What is the value of Y needed to achieve her goal?

Essentials Of Investments

11th Edition

ISBN:9781260013924

Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Chapter1: Investments: Background And Issues

Section: Chapter Questions

Problem 1PS

See similar textbooks

Similar questions

I NEED THIS ASAP
1. A civil engineer planning for her retirement places 10% of her salary each year into a high-technology stock fund. If her salary this year (end of year 1) is $160,000 and she expects her salary to increase by 3% each year, what will be the future worth of her retirement fund after 15 years provided it earns 7% per year? 2. A company that manufactures purgable hydrogen sulfide monitors will make deposits such that each one is 7% larger than the preceding one. How large must the first deposit at the end of year I be if the deposits extend through year 10 and the fourth deposit is $5550? Use an interest rate of 10% per year.
2. (a) A college student, Amy, decides to fund a retirement account with $2000 per year for 8 years, with the first deposit made one year from today. The rate of return will be 10%. How much will she have in her account when she retires in 40 years? (b) Amy’s friend, Dacio, decides he will start funding his retirement account 8 years from now (first payment in 9 years). He then will invest $2000 each year for 32 years. If his rate of return is 10%, how much will he have when he retires in 40 years?
Your daughter is expected to the university next year. It is estimated that she will need 10,000 each year for the for years university education. You are planning to deposit a lump sum in an account that will yield 10% per anum to cater for her university education. How much should be deposited?
Jessica wants to accumulate $13,000 by the end of 6 years in a special bank account, which she had opened for this purpose. To achieve this goal, Jessica plans to deposit a fixed sum of money into the account at the end of the month over the 6-year period. If the bank pays interest at the rate of 5% per year compounded monthly, how much does she have to deposit each month into her account? (Round your answer to the nearest cent.)
Tala McLouf, a 21-year-old BBA graduate, likes to plan for her future ahead, and would like to save $47.50 every week for her retirement later on. At the end of each year, Tala would invest her total accumulated savings into an account at the local credit union paying her a yearly interest rate of 8.25%. How much money will Tala be able to save per year? How much money will Tala have saved when she reaches 55 years old? How much would Tala have saved by the time she is 60 years old, if she starts investing for her retirement at the age of 40 after paying off the mortgage for her house in Los Angeles? Even if Tala starts saving at 40, she would still like to have the same amount of money in her account when she is 60 as she would have had, had she started saving back when she was 21.
Give typing answer with explanation and conclusion
Jennifer is planning a trip to Alaska in 5 years. She has calculated that she will need $15,000 to cover her expenses. Her bank offers money market investments at a rate of 4.5% compounded annually. What should Jennifer invest now to have the needed funds?
4. Amy Johnson wants to retire on $75,000 per year for her life expectancy of 20 years after she retires. She estimates that she will be able to earn an interest rate of 10.1%, compounded annually, throughout her lifetime. To reach her retirement goal, Amy will make annual contributions to her account for the next 30 years. One year after making her last deposit, she will receive her first retirement check. How large must her yearly contribution be?
In 9 years, David's child will go to university. David already has $5,800 set aside in the savings account but plans to contribute an additional $900 at the end of each year to this account for his children's education. He anticipates earning an annual return rate of 5% on his savings throughout that time (compounded annually). When his kid is ready to register for university, how much money will David have in this account? (Round time value factors to 3 decimal places and final answer to 2 decimal places. Omit the "$" sign in your response.)
Program Mary Cooper, Sheldon's mother, who lives in east Texas, wants to help pay for her grandchild's education. How long will it take Mary to reach her goal of $180,000 if she invests $10,000 per year, earning 6 percent? Use Appendix A-3 or the Garman/Forgue companion website. Round your answer to the nearest half-year. years
Anjelina wants to purchase an annuity that will pay her the $2,000 she needs at the end of every six months to support her shoe collection. If she plans to do this for the next 4 years and if money is currently worth 3.2% compounded semi-annually, what would her initial investment have to be? Refer to the "?"s in the table and considering inflows and outflows of cash, enter the appropriate values in the blanks below. Round dollar answers to 2 decimal places. Mode ? Mode = N = PV = PMT= FV= Previous Page N ? I/Y 3.2 A N A Next Page P CY 2 PV ? PMT ? PY 2 FV ?

SEE MORE QUESTIONS

Recommended textbooks for you

Essentials Of Investments

Finance

ISBN:

9781260013924

Author:

Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:

Mcgraw-hill Education,

FUNDAMENTALS OF CORPORATE FINANCE

Finance

ISBN:

9781260013962

Author:

BREALEY

Publisher:

RENT MCG

Financial Management: Theory & Practice

Finance

ISBN:

9781337909730

Author:

Brigham

Publisher:

Cengage

Foundations Of Finance

Finance

ISBN:

9780134897264

Author:

KEOWN, Arthur J., Martin, John D., PETTY, J. William

Publisher:

Pearson,

Fundamentals of Financial Management (MindTap Cou…

Finance

ISBN:

9781337395250

Author:

Eugene F. Brigham, Joel F. Houston

Publisher:

Cengage Learning

Corporate Finance (The Mcgraw-hill/Irwin Series i…

Finance

ISBN:

9780077861759

Author:

Stephen A. Ross Franco Modigliani Professor of Financial Economics Professor, Randolph W Westerfield Robert R. Dockson Deans Chair in Bus. Admin., Jeffrey Jaffe, Bradford D Jordan Professor

Publisher:

McGraw-Hill Education

Essentials Of Investments

Finance

ISBN:

9781260013924

Author:

Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:

Mcgraw-hill Education,

FUNDAMENTALS OF CORPORATE FINANCE

Finance

ISBN:

9781260013962

Author:

BREALEY

Publisher:

RENT MCG

Financial Management: Theory & Practice

Finance

ISBN:

9781337909730

Author:

Brigham

Publisher:

Cengage

Foundations Of Finance

Finance

ISBN:

9780134897264

Author:

KEOWN, Arthur J., Martin, John D., PETTY, J. William

Publisher:

Pearson,

Fundamentals of Financial Management (MindTap Cou…

Finance

ISBN:

9781337395250

Author:

Eugene F. Brigham, Joel F. Houston

Publisher:

Cengage Learning

Corporate Finance (The Mcgraw-hill/Irwin Series i…

Finance

ISBN:

9780077861759

Author:

Stephen A. Ross Franco Modigliani Professor of Financial Economics Professor, Randolph W Westerfield Robert R. Dockson Deans Chair in Bus. Admin., Jeffrey Jaffe, Bradford D Jordan Professor

Publisher:

McGraw-Hill Education

SEE MORE TEXTBOOKS