A trust fund with a beginning balance of $24,000 earns interest at 5.0% compounded quarterly. If withdrawals of $3,300 are made at the beginning of every three months, starting 10 years from now, how long will the trust fund last? Round properly. Answer in quarters.

A trust fund with a beginning balance of $24,000 earns interest at 5.0% compounded quarterly. If withdrawals of $3,300 are made at the beginning of every three months, starting 10 years from now, how long will the trust fund last? Round properly. Answer in quarters.

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

Related questions

Q: How much must be deposited today into the following account in order to have a $135,000 college fund…

A: Present value = Future value/(1 + r)n Future value = 135,000 Quarterly interest rate (r) = 3.16%/4…

Q: 3. A person deposits $18,000 in a fund that pays interest at the rate of 6% continuously. He…

Q: A fund is established by depositing P30,000 every beginning of 3 months for 2 years. If money is…

A: The amount of fund after final deposit can be calculated with the help of future value of annuity…

Q: 13. happy Corp. established a fund where they pay $200 annually into the fund. The interest rate…

A: Year Year-1 Year-2 Year-3 Year-4 Year-5 Total Amount that $200 invested each year will become…

Q: How much is in the fund at the end of 12 years, if it accumulated at 5% for the first 8 years, and…

A: Balance in the fund at the end of any period is the amount of money which includes the deposits…

Q: You invested $11,500 at the end of each quarter for 6 years in an investment fund. At the end of…

A: Information Provided: Invested amount = $11,500 Years = 6 Future value of invested amount =…

Q: To provide for expansion, a company has established a sinking fund earning 9% semi-annually. The…

A: Future value is the estimated current value of future cash flows that is discounted at an assumed…

Q: In order to meet some future liabilities, a company makes the following series of regular…

A: Given information : First three year payments made in every 4 months 13633 Second four year…

Q: Arish has $25,000 in an investment account and plans to contribute $1,000 at the start of each…

A: Rate of interest The cost associated with borrowing money. Over time, it is given as a percentage…

Q: You are considering investing $1,000 in an investment fund at the end of every quarter for the next…

A: As per the time value of money concept, a certain amount held today is worth more than holding the…

Q: Stacy Medavoy will invest $8,480 a year for 20 years in a fund that will earn 11% annual interest.…

A: Variables in the question:PMT=$8480 (a year)N=20 yearsRate=11%Annuity due-Where payment is made at…

Q: In order to accumulate $1,000,000 over 20 years, how much would you have to invest at the beginning…

A: Future value of money is the amount of deposit done and amount of compounded interest accumulated…

Q: Using the appropriate interest table, provide the solution to each of the follofour questions by…

A: The future value of an annuity is the total value of a series of equal cash flows received or paid…

Q: Bright Inc. will be receiving $5,300 at the end of every month for the next 3 years. If these…

A: The objective of the question is to calculate the future value of a series of monthly payments…

Q: An investor wishes to accumulate 10,000 in a fund at the end of 19 years. To accomplish this, she…

A: The concept of time value of money will be applied here. The amount of X being deposited in each…

Q: Rebecca made equal deposits at the beginning of every 3 months into an RRSP. At the end of 10 years,…

A: The size of quarterly deposits can refer to the amount of money that a business needs to deposit…

Q: A fund is to created by investing 900 at the end of every month for 9 years. IF money is worth 9%…

A: Monthly investment (C) = 900 Annual interest rate = 9% Monthly interest rate (R) = 9%/12 = 0.75%…

Q: You invested $7,000 at the end of each quarter for 8 years in an investment fund. If t balance in…

A: Solution: An amount deposited at end of every period is known as ordinary annuity. The formula for…

Q: A sinking fund amounting to $19,000 is to be created by making payments at the beginning of every 6…

A: in this you have to find out future value FACTOR and sinking fund required.

Q: Adam invested $9,000 at the end of each quarter for 6 years in an investment fund. If the balance in…

A: Quarterly deposit = $9000Future value = $245,500Quarterly period = 24 (i.e. 6 years * 4)Quaterly…

Q: A sinking fund is established to discharge a debt of $60,000 in 15 years. If deposits are made at…

A: using financial calculator, N =15*2 =30 I/Y = 4/2 =2 PV = 0 FV = -60000

Q: Find the interest rate needed to accumulate $45,000 in a sinking fund in 10 years, with annual…

A: A fund that is created to repay a debt or replacement of an asset by putting an equal sum of amount…

Q: How much should SKF Steel Company invest in a fund to be able to withdraw $10,000 at the end of…

A: Future value of money includes the amount being deposited over the period of time and interest…

Q: Deposits of $6000 are put into a fund at the end of each month for the next 9 years. At the end of…

A: The perpetuity refers to the regular payment of receipt for an infinite period of time at a certain…

Q: What is the equivalent average annual effective rate of interest over 5-year period if the fund…

A: Effective interest rate is the interest rate considering the impact of compounding on the interest…

Q: Give typing answer with explanation and conclusion Patricia made equal deposits at the beginning of…

A: Given details:Deposits per year: 4Total period: 10 yearsAccumulated value: $45,000APR: 4.75% with…

Q: A small business owner deposits $5000 monthly deposits in an equity fund as his financial analysis…

A: future value of annuity formula: Future value =A×1+rmm×n-1rmwhere,A=annuityr=rate of…

Q: $1,000 is invested in a fund at the beginning of the year. The fund rate of return is 8% for the…

A: Investment amount = $1000 Interest rate is divided semi annually First half year, Interest rate = 8%…

Q: corporation hopes to withdraw $9,000 at the end of each year for six years from a fund that earns 7%…

A: Variables in the question:Withdrawal each year (PMT)=$9000 n=6 yearsRate=7%

Q: Two payments of $12,000 and $3,500 are due in 1 year and 2 years, respectively. Calculate the two…

A: 1.The size of the two equal payments is $8,629.28 2.t = 3.62 years 3.r = 8.76%Explanation:Step…

Q: how much can we paid in scolarships at the end of half year if $90.000 is deposited in a trust fund…

A: Amount Deposited = $90,000 Annual Interest Rate = 8.5%Semiannual Interest Rate = 8.5% / 2Semiannual…

Q: Equal deposits are made into a sinking fund at the end of each year for seven years. Interest is…

A: A sinking fund is a fund set up to pay off future debt. A fixed amount is put in at regular…

Q: Sean's investment of $81,400.00 in a fund matured to $155,777.80 in 8 years. If the interest in the…

A: The periodic interest rate refers to the return that the investment provides for each period. The…

Q: Lindsey made equal deposits at the beginning of every 3 months into an RRSP. At the end of 9 years,…

A: Compound = Quarterly = 4Time = t = 9 * 4 = 36Future Value = fv = $50,000Monthly Compound Interest…

Q: What will be the balance on September 027 in a fund which is accumulated by aking $30,000 annual…

A: The estimated amount that an initial quantity of money will grow to, taking into account the…

Q: Assume that your uncle starts an account for you in a mutual fund with an initial deposit of $790…

A: A mutual fund is a pool of funds collected from various investors and invested into various…

Q: 124 0.4950495 0.4926108 0.4901961 0.4854369 0.4807692 0221 0.3267547 0.3235304 0.3203485 0.3141098…

A: We have to find out future value FACTOR of annuity and find out quarterly payment.

Q: Find the amount of each payment to be made into a sinking fund earning 9% compounded monthly to…

A: Data given: A=Amount to be accumulated = $86,000 P= Payment to be made = ? i=interest rate…

Q: Bright Inc. will be receiving $5,400 at the end of every month for the next 2 years. If these…

A: Future value of money is the amount of deposit made and amount of interest accumulated on that…

Q: Find the amount of each payment to be made into a sinking fund earning 7% compounded monthly to…

A: Future value (FV) = $39,000 Interest rate = 7% Monthly interest rate (r) = 7%/12 =…

Q: withdrawal is to be made 5 years from now, how long will it take for the fund to be depleted?

A: Future Value: It represents the compounded amount of the present sum invested over a period of…

Q: On January 1, 2025, Sandhill Company decided to begin accumulating a fund for asset replacement five…

A: The amount that is deposited today will be of cumulative worth tomorrow to be adjusted with the time…

Q: Urgently need. An engineer wishes to set up a special fund by making uniform semiannual…

A: Present Value: The present value is the value of cash flow stream or the fixed lump sum amount at…

Q: Commencing January 1 2022 Narelle plans to deposit $500 at the beginning of each month into an…

A: Given the following: Periodic deposit, P = $500 Interest rate from 1 January to 30 June, r1 = 2.62%…

Question

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

SEE SOLUTION Check out a sample Q&A here

Step 1: Trust Fund

VIEW

Step 2: Calculate the number of withdrawals

VIEW

Solution

VIEW

Step by step

Solved in 3 steps with 1 images

SEE SOLUTION Check out a sample Q&A here

Similar questions

An investor needs $22,000 in 11 years. (a) What amount should be deposited in a fund at the end of each quarter at 5% compounded quarterly so that there will be enough money in the fund? (b) Find the investor's quarterly deposit if the money is deposited at 4.2% compounded quarterly. (a) The deposit should be $. (Round to the nearest cent as needed.)
An investor wants to accumulate $50,000 in a fund at the end of 20 years. If the investor deposit$1,000 in the fund at the end of each of the first 10 years and $1, 000 + X at the end of each ofthe second 10 years, find the value of X if the fund earns 7% effective. Do the following steps toanswer this problem: a. $1,000 are deposited in the fund at the end of each of the first 10 years. This means thatthis is an example of annuity-immediate. Compute for the accumulated value of the fund inthe first 10 years. Call this T.b. The value of the fund in the first 10 years is T . Solve for the future value of T at the end ofthe next 10 years. Use the formula Future value = P (1 + i) t. Call this answer FV . (2points)c. The target amount of the investor is $50,000. The investment made in the first 10 yearsalone will grow to the value FV at the end of 20 years. So, in the second 10 years, theaccumulated value of the investment must be $50, 000 − FV . What is this value? Call thisU .
Bank ZLX is marketing their new fund by noting that a fixed $320 monthly deposit in their fund should be expected to net $1,900,000 in 35 years. Assume the first deposit is made at the end of this month. What effective annual rate (EAR) is Bank ZLX expecting their new fund to return?
Find the amount of each payment to be made into a sinking fund which earns 8% compounded quarterly and produces $42,000 at the end of 3.5 years. Payments are made at the end of each period. The payment size is $. (Round to the nearest cent.)
At the end of every six months for 20 years, it gains value with an annual effective interest rate of 10%. Continuous payments are made to a fund as 500, 1000, 500, 1000, …, respectively. Calculate the amount accumulated in the fund at the end of twenty years?
Need help solving
A sum of 50,000 deposited in a fund which will earn 12% compound semiannualy for the first 5 years and 8% interest compounded quarterly for the next 7 years. How much will be the amount after 12 years.
Create a complete sinking fund schedule and calculate the total payments and interest earned needed for a fund of $9,000 one year from now. The fund will receive deposits made at the end of every three months and earns 5% compounded quarterly. Payment Number 1 2 3 4 Total Payment Amout at End ($) (PMT) Number Number Number Number Total PMT = Number Interest Earned or Accrued ($) (INT) Number Number Number Number Total INT Number Principal Balance Accumulated at End of Payment Interval ($) (BAL) Number Number Number Number
Serena Medavoy will invest $7,680 a year for 20 years in a fund that will earn 4% annual interest. Click here to view factor tables. If the first payment into the fund occurs today, what amount will be in the fund in 20 years? If the first payment occurs at year-end, what amount will be in the fund in 20 years? (Round factor values to 5 decimal places, e.g. 1.25124 and final answers to O decimal places, e.g. 458,581.) First payment today First payment at year-end $ +A $
12. Keys Company has a target of establishing a fund of $50 000. If $10 000 is deposited at the end of every six months, and the fund earns interest at 4% compounded quarterly, how long will it take to reach the target?
If 1000 pesos was deposited in a fund at the beginning of each 3 months for 10 years and money is invested at 6% compounded quarterly, how much is in the fund at the end of 10 years?
26. To create a fund of P1,000,000, how many deposits of P48,000 must be placed at the beginning of each month if money accumulates at the interest rate of 6% compounded monthly? Use 2 decimal places for your final answer

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