Give the Given, solution and cash flow diagram. Reybien plans ahead for his 10-year-old daughter, Alia. Determine the monthly savings that Reybien should make with the interest of 5.41% per annum to amount P120,000 at the time Alia will be 18. Show your Cash flow diagram.

Give the Given, solution and cash flow diagram. Reybien plans ahead for his 10-year-old daughter, Alia. Determine the monthly savings that Reybien should make with the interest of 5.41% per annum to amount P120,000 at the time Alia will be 18. Show your Cash flow diagram.

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: Madison is thinking of buying an investment from PEP. If she purchases the investment, Madison will…

A: The present value of the annuity due is the current worth of a cash flow series received/paid at the…

Q: A person wishes to accumulate Php500,000 over a period of 15 years in his savings account, what…

A: The given scenario is a basic case of annuity. Inorder to find the yearly payment, we use the…

Q: has found a mutual fund that will earn 10 percent semi-annually. How much will Sar ay? What if Sarah…

A: Money have time value and value of money change with time, Money today will not be same tomorrow.

Q: Henry would like to have a retirement income of $3,000 per month (month-end payments). How much must…

A: We need to use present value of ordinary annuity(payment due at end of period) formula to solve this…

Q: A. Anthony inherited an annuity worth $3,811.62 from his uncle. The annuity will pay him four equal…

A: A theory that helps to compute the present or future value of the cash flows is term as the TVM…

Q: Angela has a trust fund that will mature in three years with a value of $15,000. If this trust fund…

A: solution Given Future value $15,000 Period (n) 3 years Interest rate (r) 5%…

Q: As a parent, you want to secure the future of your only child who is now 5 years old. How much do…

A: Let the investment now = X Focal year = Age 17 Years for the investment to grow (n) = 12 Annual…

Q: Your mom asked your opinion if she will be joining the cooperative in her office. She wants to know…

A: rch SEARCH ASK CHAT MATH SOLVER BusinessFinanceQ&A LibraryYour mom asked…

Q: Consider the two savings plans below. Compare the balances in each plan after 6 years. Which person…

A: Future Value: The worth of a current asset at some point in the future based on an estimated rate of…

Q: Elizabeth has $31,209.00 in an investment account. Her goal is to have the account grow to…

A: The concept of TVM refers to the interest-earning capacity of money because money earned earlier is…

Q: Mrs. John wants to take the next three years of work to travel around the world. She estimates her…

A: To find the amount to be invested now, we need to calculate the present value of the fund required…

Q: Suppose Ted deposits $10,000 in a savings plan earning 5% compounded annually and Tess deposits…

A: Future value The value of the current investment on a future date is called the future value. The…

Q: what amount will he have in his retirement plan at the end of 15 years? Assume his plan will earn…

A: Time value of money (TVM) refers to the method or concept which is used to determine the amount of…

Q: Consider the two savings plans below. Compare the balances in each plan after 15 years. Which person…

A: Future Value of annuity : To know the which plan is better we have to calculate the future value of…

Q: Suppose you make an annual contribution of BD100 each year to a college education fund for a niece.…

A: Here, Annual Deposits is BD100 Interest Rate is 6.5% Current Age is 4 years Last Deposit is made on…

Q: Consider the two savings plans below. Compare the balances in each plan after 12 years. Which person…

A: Time Period is 12 years Deposits of Yolanda is $350 per month Deposits of Zach is $4,200 per year…

Q: Ms. Perez wants to invest in a savings account with interest rate of 9% per year. She decided to…

A: Present value of annuity is the current value of the future payments that are calculated using the…

Q: Juanita has an opportunity to invest in her friend's clothing store. The initial investment is…

A: The internal rate of return is one of the capital budgeting techniques used to know the…

Q: You intend to create a college fund for your baby. If you can get an APR of 3.0% and want the fund…

Q: Branscr Consider the two savings plans below. Compare the balances in each plan aher 7 years. Which…

A: Future value is the estimation of current value of future cash flows that are likely to be received…

Q: Caitlyin is saving to buy a house.She plans to deposit $12, 000into her account today and 1year from…

A: The objective of the question is to calculate the total amount of money Caitlyin will have in her…

Q: Use a financial calculator to calculate the number of years it will take for X to save $50,000…

A: Annuity due is the amount of annuity that has to be paid at the beginning of the period.

Q: uppose you are 40 years old and plan to retire in exactly 20 years. 21 years from now you will need…

A: The concept of time value of money will have to be used here. As per the concept of time value of…

Q: 1

A: The present value factor (PVF) is a financial treatment used for estimation of the current value of…

Q: Saleh is considering an investment that will pay $5,000 a year for 7 years, starting one year from…

A: Given: Years = 7 Amount = $5, 000 Interesting rate = 12%

Q: To protect her savings against further inflation and to help her prepare for a healthy financial…

A: The future value (FV) is the amount of money that an investment will be worth at a specified date in…

Q: to pay his son’s university tuition fees for 4 years starting 18 years from now. The current annual…

A: There is need of planning for the future cost of education because compounding increase value of…

Q: Suppose you have a 1-year old daughter and you want to provide R81 000 in 19 years towards her…

A: Interest rate is the compounding rate which is used to compound present value over a specified…

Q: 6) Your daughter is born today, and you want her to be a millionaire by the time she is 35 years…

A: To given solution-Explanation:Complete solution.

Q: Christine would like to know the value of their savings, assuming that they deposit $750 each month…

A: Monthly deposit (P) = $750 Growth rate (g) = 3% Period = 25 Years Number of deposits (n) = 25*12 =…

Q: You begin saving for your retirement by investing $500, matched by your employer with $300 at the…

A: Solution:-When an equal amount is saved each period at end of period, it is called ordinary…

Q: Margaret has an investment opportunity where she can receive cashflows as follows 1) $1000 end of…

A: Here, YearCash flows1 $1,000.002 $1,000.003 $1,100.004 $1,100.005 $1,200.008 $1,400.00Interest…

Q: Answer the following questions by including the appropriate cash flow diagrams, solution, and final…

A: The concept of the TVM states that between the same amount of money received now or at a later date,…

Question

Give the Given, solution and cash flow
diagram.
Reybien plans ahead for his 10-year-old
daughter, Alia. Determine the monthly savings
that Reybien should make with the interest
of 5.41% per annum to amount P120,000 at
the time Alia will be 18. Show your Cash flow
diagram.
A. P2,013.64
B. P1,234.56
C. P1,007.22
D. P1,457.70

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

Step 2

Step 3

Step 4

Step 5

Step by step

Solved in 5 steps with 4 images

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, finance and related others by exploring similar questions and additional content below.

Similar questions

c) Retirement Investment: Savings at Retirement = Saving Periods = Interest Rate = Savings Deposit / month= monthly deposits / month
what effective annual rate of return would rayne need to earn if she deposits 1,000 per month into an account beginning one month from today in order to have a total of 1000000 in 30 years?
Marsiah Crunch plans to deposit cash in her saving account each year as shown below. Her saving effort would be useful as preparation for her son’s education. Year Deposit (RM) 0 1000 1 2000 2 2000 3 2000 4 3000 5 3000 6 3000 (a) Draw a cash flow diagram. (b) Estimate the future worth (FW) at the end of the 10th year based on the investment rate of 8% per annum.
Future value with periodic rates. Denise has her heart set on being a millionaire. She decides that at the end of every year, she will put away $4,800 into her "I want to be a millionaire account" at her local bank. She expects to earn 6.5% annually on her account. a. How many years must Denise faithfully put away her money to succeed at becoming a millionaire? b. If Denise switches to a monthly savings plan and puts one-twelfth of the $4,800 away each month ($400), how much will she have in 43 years at the 6.5% APR? c. Why is the future value under the monthly savings plan more than the $1,000,000 goal?
Sarah Wiggum would like to make a single investment and have $1.2 million at the time of her retirement in 30 years. She has found a mutual fund that will earn 4 percent annually. How much will Sarah have to invest today? If Sarah invests that amount and could earn a 14 percent annual return, how soon could she retire, assuming she is still going to retire when she has $1.2 million? Click on the table icon to view the PVIF table To have $1.2 million at retirement, the amount Sarah must invest today is $ (Round to the nearest cent.)
Stuck
Your friend already has $20,000 in an investment account. In addition to this amount, she is considering investing $5,000 at the end of year 1 with this amount growing at 6% p.a. until the end of year 5. If the interest rate earned by the investment account is expected to be 8% p.a., the total amount she will have accumulated in this account at the end of five years is closest to: Group of answer choices $29,387. $32,776. $62,162. $66,120.
Mr & Mrs. John have decided to start a monthly savings program in order to provide for their son's college education. How much should they deposit at the end of each month in a savings account earning interest at the rate of 6%/year compounded monthly so that at the end of the tenth year the accumulated amount will be RM50,000?
Matt plans to start his own business once he graduates from college. He plans to save $2,000 every six months for the next four years. If his savings earn 8% annually (or 4% every six months), determine how much he will save by the end of the fourth year. (FV of $1, PV of $1, FVA of $1, and PVA of $1) (Use appropriate factor(s) from the tables provided. Round your answer to 2 decimal places.)
Sally enters into an investment that will guarantee her 5% year if she deposits $2045 each year for the next 10 years. She must make the first deposit one year from today. How much will she have when she makes her last payment 10 years from now? (Please use excel function = FV) to solve
Suppose Chris plans to make a $644 savings payment at the beginning of each month for 22 years with his first payment 10 years from today. Use this information and assume an interest rate of 5.91% per year to find the future value of his savings payments.
On her recent birthday, April 22, 2001, Nicole was given by her mother a certain sum of money as birthday present. She decided to invest the said amountof 20% exact simple interest. If the account will mature on Christmas day at an amount P10,000.00, how much did Nicole receive from her mother on her birthday? Draw the cash flow diagramwith your solution.

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