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- You want to invest $8,000 at an annual Interest rate of 8% that compounds annually for 12 years. Which table will help you determine the value of your account at the end of 12 years? A. future value of one dollar ($1) B. present value of one dollar ($1) C. future value of an ordinary annuity D. present value of an ordinary annuityUse the tables in Appendix B to answer the following questions. A. If you would like to accumulate $4,200 over the next 6 years when the interest rate is 8%, how much do you need to deposit in the account? B. If you place $8,700 in a savings account, how much will you have at the end of 12 years with an interest rate of 8%? C. You invest $2,000 per year, at the end of the year, for 20 years at 10% interest. How much will you have at the end of 20 years? D. You win the lottery and can either receive $500,000 as a lump sum or $60,000 per year for 20 years. Assuming you can earn 3% interest, which do you recommend and why?You put $250 in the bank for S years at 12%. A. If interest is added at the end of the year, how much will you have in the bank after one year? Calculate the amount you will have in the bank at the end of year two and continue to calculate all the way to the end of the fifth year. B. Use the future value of $1 table in Appendix B and verity that your answer is correct.
- Calculating interest earned and future value of savings account. If you put 6,000 in a savings account that pays interest at the rate of 3 percent, compounded annually, how much will you have in five years? (Hint: Use the future value formula.) How much interest will you earn during the five years? If you put 6,000 each year into a savings account that pays interest at the rate of 4 percent a year, how much would you have after five years?What amount must I deposit in the bank to receive $6,000 in twelve years if my account pays 3.5% compounded Monthly?If you deposit $250 into an account that earns 4.8% interest compounded monthly, How much will you have in the account 30 years from now ? What is the interest earned on the account ?
- What is the amount a person would need to deposit today to be able to withdraw $6,000 each year for ten years from an account earning 6 percent?How much would you have in savings if you kept $200 on deposit for eight years at 8%, compounded quarterly?how much should you deposit in a bank paying 2% compounded quarterly to accumulate an amount of 80,000 in 5 years and 9 months ?
- If you deposit $250 each month into an individual retirment account that earns 4.8% interest compounded monthly, a.) How much will you have in the account 30 years from now ? b.) What is the interest earned on the account ?How many years will it take for your money to tripple if you deposit $800 in a bank account that pays 14% a year, compounded semi-annually?How much would you need to deposit in an account each month in order to have $20,000 in the account in 7 years? Assume the account earns 3% interest.