Beginning in January, a person plans to deposit $1000 at the end of each month into an account earning 6%compounded monthly. Each year taxes must be paid on the interest earned during that year. Find the interest earned during each year for the first 3 years. The interest earned during the first year is

Beginning in January, a person plans to deposit $1000 at the end of each month into an account earning 6%compounded monthly. Each year taxes must be paid on the interest earned during that year. Find the interest earned during each year for the first 3 years. The interest earned during the first year is

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

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Similar questions

On August 19, Siobhan O’Sullivan started an ordinary annuity. She arranged to have $150 deducted from her end-of-month paychecks. The money would earn 6 7/8 % interest compounded monthly. a) Find the future value of the account on December 1.b) Find Siobhan’s total contribution to the account.c) Find the total interest earned.
Zoey signs a note to repay $10,000.00 plus 8% interest in 1 year. Four months before the note is due, the debt is commuted into 3 equal payments. The first payment is due immediately and the 2nd and 3rd payment are due 4 and 12 months from the date of commutation. The interest rate is set at 9% and the focal date 4 months from the date of commutation. Calculate the amount of the new payments.
To attend school, Aisha deposits 5800 at the end of every quarter for five and one-half years. What is the accumulated value of the deposits if interest is 12% compounded semi-annually?
You deposit $1,000 at the end of the year (k = 0) into an account that pays interest at a rate of 6% compounded annually. Two years after your deposit, the savings account interest rate changes to 12% nominal interest compounded monthly. Six years after your deposit, the savings account again changes its interest rate; this time the interest rate becomes 8% nominal interest compounded quarterly. Nine years after your deposit, the saving account changes its rate once more to 5% compounded annually. a. How much money should be in the savings account 18 years after the initial deposit, assuming no further changes in the account's interest rate? b. What interest rate, compounded annually, is equivalent to the interest pattern of the saving account in Part (a) over the entire 18 year period? a. S should be in the savings account 18 years after the initial deposit. (Round to the nearest dollar.) b. The interest rate equivalent to the interest pattern of the saving account in Part (a) over…
Alvin has $16000 in his saving account. For how long can he withdraw $1600 be from the account at the end of every quarter starting one month from now if interest is 6% compounded semi- annually?
Sara deposits $13,900 into an account. For the first two years, money in the account earns 5.5% annual interest. After that. the interest rate jumps to 5.8% annual interest. How much would be in the account at the end of 4 years
Monica invests $1600 into an account the beginning of each quarter for 9 years, starting from today. Interest is to be paid at an interest rate of 1.4% per month, compounded quarterly. Peter, would like to invest two lump sums at the beginning of the 2nd year and 4th year, with the lump sum payment 2 times greater at the 4th year than the 2nd year. Peter's account receives the same interest rate as Monica. Determine the effective interest rate per quarter under this investment. Round your answer to the nearest 0.01% Determine the future value of Monica's investment at the end of the 9 years. Round your answer to the nearest $100 Determine what lump sum Peter must invest at the beginning of the 2nd year that would yield the same yield value as Monica by the end of the 7 years. Round your answer to the nearest $100.
A mother borrowed 180,378 with 0.09 compounded monthly and promised to pay the amount by 20 equal monthly installments which will start at the beginning of each period. Determine the monthly payment.
To attend school, Arianna deposits $160 at the end of every month for three and one-half years. What is the accumulated value of the deposits if interest is 9% compounded quarterly? The accumulated value is S (Round the final answer to the nearest cent as needed. Round all intermediate values to six decimal places as needed.)
A $17,131 loan was made to you on January 1. The interest rate for the year is 7%. Every year, interest is compounded. There have been no yearly payments required, but after nine years, you must pay back the entire amount borrowed, including interest. How much will you pay back? Give your response a two-decimal place number.
How much should a family deposit at the end of every 6 months in order to have $ 4000 at the end of 3 years? The account pays 4.6% interest compounded semiannually. (Round your final answer to two decimal places.)
A student decides to make annual payments of Php 1619 into a bank that has a nominal interest of 4% compounded semiannually. How much money will this student have accumulated in this bank account at the end of 13 years?

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