Arnie agrees to contribute $2,300 to the road fund at the end of each year for the next 12 years. Jack wants to match Arnie's contribution, but he wants to make a lump-sum contribution today. If the current interest rate is 3.5% compounded annually, how much should Jack deposit to equal Arnie's annual deposits? (Round your answer to the nearest cent.)

Arnie agrees to contribute $2,300 to the road fund at the end of each year for the next 12 years. Jack wants to match Arnie's contribution, but he wants to make a lump-sum contribution today. If the current interest rate is 3.5% compounded annually, how much should Jack deposit to equal Arnie's annual deposits? (Round your answer to the nearest cent.)

Excel Applications for Accounting Principles

4th Edition

ISBN:9781111581565

Author:Gaylord N. Smith

Publisher:Gaylord N. Smith

Chapter27: Time Value Of Money (compound)

Section: Chapter Questions

Problem 6E

See similar textbooks

Similar questions

John plans to set aside money for his young daughter's college tuition. He will deposit money in an ordinary annuity that earns 2.4% interest, compounded monthly. Deposits will be made at the end of each month. How much money does he need to deposit into the annuity each month for the annuity to have a total value of $71,000 after 14 years? Do not round intermediate computations, and round your final answer to the nearest cent.
Goran plans to set aside money for his young daughter’s college tuition. He will deposit money in an ordinary annuity that earns 2.4% interest, compounded quarterly. Deposits will be made at the end of each quarter. How much money does he need to deposit into the annuity each quarter for the annuity to have a total value of $71,000 after 16 years? Do not round intermediate computations, and round your final answer to the nearest cent.
Frank plans to set aside money for his young daughter's college tuition. He will deposit money in an ordinary annuity that earns 4.2% interest, compounded quarterly. Deposits will be made at the end of each quarter. How much money does he need to deposit into the annuity each quarter for the annuity to have a total value of $71,000 after 14 years? Do not round intermediate computations, and round your final answer to the nearest cent. If necessary, refer to the list of financial formulas.
Frank plans to set aside money for his young daughter's college tuition. He will deposit money in an ordinary annuity that earns 7.2% interest, compounded quarterly. Deposits will be made at the end of each quarter. How much money does he need to deposit into the annuity each quarter for the annuity to have a total value of $71,000 after 16 years?
Manuel is preparing for an income fund for his retirement. He wants to receive P 15 500 at the beginning of each month for the next 25 years. The income fund pays 10.5% per year compounded monthly. How much must Manuel deposit now to pay for the annuity?
Nine years from now, Sam wants to have an amount available to deposit into an account that earns 6 percent compounded annually. This account is to provide Sam with an income of $10,000 at the end of each year for 10 years. To accomplish this, Sam invests in an 8-year bank certificate that pays 8 percent compounded semiannually, and he will use this certificate, plus interest , to establish his income account. What should be the principle value of the certificate be ? please solve these math details and do not be use any software
Your uncle gives you $92,000 as a gift. Rather than give you a lump-sum, your uncle structures the gift as an annuity that pays $16,250 per year. You will receive the first payment one year later. If the annual interest rate is 12%, how many years does it take for you to receive all the payments for this gift?
Manuel plans to set aside money for his young daughter’s college tuition. He will deposit money in an ordinary annuity that earns 5.4% interest, compounded monthly. Deposits will be made at the end of each month. How much money does he need to deposit into the annuity each month for the annuity to have a total value of $72,000 after 16 years?
Walter deposits a fixed quarterly amount into an annuity account for his child's college fund. He wishes to accumulate a future value of $⁢80,000 in 12 years. Assuming an APR of 3.7% compounded quarterly, how much of the $⁢80,000 will Walter ultimately deposit in the account, and how much is interest earned? Round your answers to the nearest cent, if necessary.
June Watson is contributing $2,000 each year to a Roth IRA. The IRA earns 4.4% per year. How much will she have at the end of 35 years? If June's first payment is made with the establishment of the Roth IRA, she will have S (Round to the nearest cent as needed.)
Geoff has paid $16,000 for a retirement annuity from which he will receive $1,582 at the end of every six months. The payments are deferred for 11 years and interest is 4% compounded semi-annually. (a) How many payments will Geoff receive? (b) What is the size of the final payment? (c) How much will Geoff receive in total? (d) How much of what he receives will be interest?
Jim wants to deposit an amount anually to meet his retirement needs. Assume that he will deposit a fixed annual amount for the next 20 years into a retirement savings account, starting one year from now. Mark has a son who will be attending college and plans to make 5 withdrawals (starting one year after making his final deposit into the retirement account) of $35,000 each to pay for his annual tuition for the following 5 years. Commercial Banks will be paying 6 percent on such retirement accounts for the next 25 years. How much should Mark place in the account annually to cover his retirement needs.