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
Related questions
Question
| Use the table below to answer the following questions: | ||||||||
| Present Value of an |
||||||||
| Period | 4% | 5% | 8% | 10% | 4% | 5% | 8% | 10% |
| 4 | 3.6299 | 3.5460 | 3.3121 | 3.1699 | 4.2465 | 4.3101 | 4.5061 | 4.6410 |
| 5 | 4.4518 | 4.3295 | 3.9927 | 3.7908 | 5.4163 | 5.5256 | 5.8666 | 6.1051 |
| 6 | 5.2421 | 5.0757 | 4.6229 | 4.3553 | 6.6330 | 6.8019 | 7.3359 | 7.7156 |
| 7 | 6.0021 | 5.7864 | 5.2064 | 4.8684 | 7.8983 | 8.1420 | 8.9228 | 9.4872 |
| 8 | 6.7327 | 6.4632 | 5.7466 | 5.3349 | 9.2142 | 9.5491 | 10.6366 | 11.4359 |
| 9 | 7.4353 | 7.1078 | 6.2469 | 5.7590 | 10.5828 | 11.0266 | 12.4876 | 13.5795 |
| 10 | 8.1109 | 7.7217 | 6.7101 | 6.1446 | 12.0061 | 12.5779 | 14.4866 | 15.9374 |
| 11 | 8.7605 | 8.3064 | 7.1390 | 6.4951 | 13.4864 | 14.2068 | 16.6455 | 18.5312 |
Bobby receives alimony payments every 6 months and the next payment is tomorrow. Median homes go for $950,000 and he wants to save $190,000 in 4 years. How much money should Bobby put away into an investment each time he receives alimony payments if he can get a 8% return a year?
Group of answer choices
$23,131
$31,624
$35,593
$46,262
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