Suppose that you would like to have $25,000 to use as a down payment for a home in five years by making regular deposits at the end of every three months in an annuity that pays 7.25% compounded quarterly. Determine the amount of each deposit. Round up to the nearest dollar. How much of the $25,000 comes from deposits and how much comes from interest?
Suppose that you would like to have $25,000 to use as a down payment for a home in five years by making regular deposits at the end of every three months in an annuity that pays 7.25% compounded quarterly. Determine the amount of each deposit. Round up to the nearest dollar. How much of the $25,000 comes from deposits and how much comes from interest?
Chapter4: Time Value Of Money
Section: Chapter Questions
Problem 34P
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- Suppose that you would like to have $25,000 to use as a down payment for a home in five years by making regular deposits at the end of every three months in an
annuity that pays 7.25% compounded quarterly.
- Determine the amount of each deposit. Round up to the nearest dollar.
- How much of the $25,000 comes from deposits and how much comes from interest?
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