8. Will Smith will receive $80,000 5 years from now, from a trust fund established by his father. Assuming the appropriate interest rate for discounting is 12% (compounded semiannually), what is the present value of this amount today?

To save for her newborn son's college education, Lea Wilson will invest P1,000 at the beginning of each year for the next 18 years. The interest rate is 12 percent. What is the future value? * 55,750. O 7,690 34,931. O 63,440. O 62,440.

Consider an inheritance that pays the beneficiary an annuity of $500 that begins immediately (an annuity due) and then annually in year 1 through year 17 (for a total of 18 years) with one exception - the payment in year 12, and only 12, is not $500 but $0. Using an interest rate of 3%, determine the present value of this cash flow stream.

The Good Fairy has offered to give you $1,000,000 in 20 years. She has volunteered to deposit the present value of the $1,000,000 in a trust managed by a bank or insurance company of your choice. How much must the Good Fairy deposit if the investment earns annual compounding interest of 5 percent?

Mary is going to receive a 31-year annuity of $8,600 per year. Nancy is going to receive a perpetuity of $8,600 per year. If the appropriate interest rate is 9 percent, how much more is Nancy’s cash flow worth?

Assume that Dorothy Williams desires to accumulate $926,000 in 15 years using her money market fund balance of $254,222. At what interest rate must Dorothy’s investment compound annually?

Q3) Mr. Clifton Chen, aged 39, recently purchased an endowment plan from an insurer that requires him to set aside $25,000 per year for the next 23 years till he retires at age 62. The first premium payment occurs at the beginning of the period. Assuming an inflation rate of 2% and an estimated rate of return of 3.2% from the endowment plan, what is the estimated future value of Clifton’s regular savings at age 62?

Your grandparents would ilke to establish a trust fund that will pay you and your heirs $125,000 per year forever with the first payment 10 years from today. If the trust fund earns an annual return of 2.4 percent, how much must your grandparents deposit today?

Today is January 1, 2022. Roy will use a single premium to purchase an annuity today. This annuity pays $10,000 at the end of each year while Roy is alive. The estimated probability of Roy surviving for the next 4 years is stated in following table. The yield rate is assumed to be j₁ = 4.5% p.a. Calculate the premium value. Round your answer to three decimal places. Year 1 2 3 4 Probability of surviving from start of year to end of year a. $17490.442 b. $19100.000 c. $14729.264 d. $17651.074 0.83 0.62 0.46 0 Today is 1 July, 2022, Georg plans to purchase a corporate bond with a coupon rate of j2 = 3.15% p.a. and a face value of $100. This corporate bond matures at par. Its maturity date is 1 January, 2025. The yield rate is assumed to be j₂ = 4.7% p.a. Assume that this corporate bond has a 9% chance of default in any six-month period during its term. Assume, also, that, if default occurs, Georg will receive no further payments at all. Calculate Georg's purchase price. Round your answer…

Gary is planning for his retirement this year. One option that has been presented to him is the purchase of an annuity that would provide a $31, 000 payment each year for the next 18 years. Factor Table Appendix 9.1 Present value of $1 received in n periods = 0.1799 Appendix 9.2 Present value of an annuity of $1 per period= 8.2014 Calculate how much Gary should be willing to pay for the annuity if he can invest his funds at 10% ( For calculation purposes, use 4 decimal places as displayed in the factor table provided and round the final answer to 0 decimal places, e.g. 58,971)