Ed Long promised to pay his son $320 semiannually for 12 years. Assume Ed can invest his money at 6% in an ordinary annuity. How much must Ed invest today to pay his son $320 semiannually for 12 years?

Q: Shawn purchases a retirement annuity that will pay him $1,000 at the end of every six months for the…

A: Present value of annuity Annuity is a series of equal payments at equal interval over a specified…

Q: Cam deposited $50,000 into an IRA 25 years ago, what is the value of his account today if he earned…

A: The problem is asking us to find the future value of an investment. Cam deposited $50,000 into an…

Q: Jenna purchases a retirement annuity that will pay her $1,000 at the end of every six months for the…

A: Semi Annual Payment Semi Annual Payment $              1,000.00Time Period (years)8Interest…

Q: James deposits a fixed quarterly amount into an annuity account for his child's college fund. He…

A: Annuity refers to a stream of cash flows that is usually fixed and constant. The cash flows occur at…

Q: son.3

A: The objective of the question is to calculate the present value of the 27 annual payments of $22,500…

Q: will receive a perpetuity of $34,000 per year forever, while curly will receive the same annual…

A: Present value is the equivalent value of money today of the future money based on the time value of…

Q: Mr. Hernandez wants to provide a series of 18 yearly allowance for his 1-year old daughter starting…

A: Present worth will be the difference between total present worth of cash inflows and total present…

Q: Tom has decided to invest $400 quarterly for 4 years in an ordinary annuity a 8%. As his financial…

A: Quaterly investment amount is $400 Time period is 4 years Interest rate is 8% To Find: Cash value…

Q: Ava enjoys investing in annuity that will pay her $5,000 at the end of each month for 5 years after…

A: Monthly payment = $ 5000 Period = 5 Years Number of monthly payment = 5*12 = 60 Annual interest rate…

Q: Nancy Billows promised to pay her son $600 quarterly for 4 years. If Nancy can invest her money at 8…

A: The provided information are: Annuity (A) = $600 Number of periods = 4(4) = 16 The rate of interest…

Q: Sheila is planning to retire in 9 years. For 9 years, at the end of each year Sheila plans to invest…

A: Annual investment (C) = $6,000 Interest rate (r) = 0.07 Number of investments (n) = 9 Final value =…

Q: To secure the future of his son, a man plan to deposit P50,000 in a bank account every quarter for 5…

A: Effective interest rate There is different frequency of deposited amount and the compounding of…

Q: Cyrus deposits a fixed monthly amount into an annuity account for his child's college fund. He…

A: Interest earned refers to an amount that is being earned by the investors over the amount of…

Q: promised to pay his son $300 semiannually for 9 years. Assume Pete can invest his money at 8% in an…

A: There is need of proper planning for the future and if done on the proper time it can have proper…

Q: Goran plans to set aside money for his young daughter’s college tuition. He will deposit money in an…

A: Given: Future value of annuity = $71,000 Interest = 2.4%

Q: Bobbi opens an IRA account in which she deposits $3,000 per year until she retires in 50 years. If…

A: The accumulated amount can be calculated with the help of future value of annuity function

Q: Jake Werkheiser decides to invest $8000 in an IRA at the end of each year for the next 6 years. If…

A: The future value refers to the value of an investment or an amount of money at a specified point in…

Q: Trish invests $6,000 in her IRA in a bond trust that pays 11% interest compounded semiannually. Sean…

A: The future value function or concept can be used to determine the future value of a present sum or…

Q: Jason received an amount of 1000.00 from his grandpa as a birthday gift. He decides to invest the…

A: Principal Amount, P = 1,000 Interest rate, r = 10% = 0.10 Time, t = 5 years Future Value, FV = P…

Q: Blushing Rose invests $1,000 into her Roth IRA. She can increase thisinvestment annually by $1,000…

A: The computation is as follows:

Q: Find the total value of the annuity at the end of the 2nd year.

A: Ordinary Annuity: These are annuity payments made at the end of the given period. These payments…

Q: aDamon and his brother Ed inherit annuities from their quirky great aunt Maeve. Damon's annuity has…

A: The present value of a growing annuity is the present worth of a series of cash flows growing at a…

Q: Salem plans to deposit $2200 every 6 months for 15 years to save for his son's higher education. The…

A: The objective of the question is to calculate the future value of a simple annuity where Salem…

Q: r. Bearer may choose to take a lump-sum payment of $25,292.8 now from his insurance policy or an…

A: Annuity is the series of equal payments that are made at regular intervals and payments are uniform…

Q: In order to fund his son’s higher education, Abdullah decided to invest $1000 quarterly for 6 years…

A: Future value is the worth of the current amount in future specified date at given interest rate. The…

Q: Michelle purchases a retirement annuity that will pay her $3,000 at the end of ever months for the…

A: Purchase price is the present value of the payments from the annuity based on the period and…

Q: At birth of his grandson, Gregorio Sirug commits to help pay his college education. He decides to…

A: Quarterly deposit (P) = P10,400 Interest rate = 10% Quarterly interest rate (r) = 10%/4 = 2.50%…

Q: how much of the $90,000$⁢90,000 will Kevin ultimately deposit in the account, and how much is…

A: Kevin deposits a fixed quarterly amount into an annuity account for his child's college fund. He…

Q: Bill is the owner of an ordinary annuity that will pay him $12,000 at the end of each of the next…

A: solution Bill is the owner of an ordinary annuity that will pay him $12,000 at the end of each of…

Q: eposit $220 at the beginning of each of the 15 years, using interest at 7% per year, how much he…

A: Given information :

Q: Michael wants to retire in 20 years with enough savings in his RRSP to be able to purchase a 30-year…

A: The present value represents the current value of the future sum of the amount or future stream of…

Q: oe purchases a£50,30-year annuity. Larry purchases a£50perpetuity. In both cases, payments begin in…

A: Perpetuity is kind of annuity in which the annuity payments are forever and for infinite period and…

Q: fank made payments of $161 per month at the end of each month for 30 years to purchase a piece of…

A: Yield to maturity can be calculated by following function in excel=RATE (nper, pmt, pv, [fv],…

Q: Alexandria wants to receive $12,000 a year for 8 years. How much must Alexandria invest today in an…

A: Computation:

Q: Frank buys a house at age 48 for $600,000 by making a $170,000 down payment and securing a 30-year…

A: Annuity refers to series of equalized payments that are paid or received at start or ending of…

Q: Ryan plans to deposit his annual bonus into a savings account that pays 3% interest compounded…

A: The compounding term refers to the interest on interest. The simple interest means the interest is…

Q: Mary is going to receive a 31-year annuity of $8,600 per year. Nancy is going to receive a…

A: Time = t = 31 years Interest rate = r = 9% Mary annuity = ma = $8600 Nancy perpetuity = np = $8600

Effective Interest Rate

The term interest rate can be defined as the amount that is charged by the lender as a percentage on the principal amount. Interest rate which is charged annually is known as annual percentage rate.