Taylor is paid on the last day of the month and 580 is automatically deducted from her pay and deposited in a savings account. If the account pays 3.6% interest compounded monthly, how how long will it take for the savings account to reach $10,000? How much of the $10,000 saved is from interest?

Taylor is paid on the last day of the month and 580 is automatically deducted from her pay and deposited in a savings account. If the account pays 3.6% interest compounded monthly, how how long will it take for the savings account to reach $10,000? How much of the $10,000 saved is from interest?

EBK CONTEMPORARY FINANCIAL MANAGEMENT

14th Edition

ISBN:9781337514835

Author:MOYER

Publisher:MOYER

Chapter5: The Time Value Of Money

Section: Chapter Questions

Problem 1P

See similar textbooks

Related questions

Q: Burke Tires just paid a dividend of Do-$1.3. Analysts expect the company's dividend to grow by 30%…

A: Here, Particulars Values Current Dividend (D0) $ 1.30 Required rate of return 9.00%…

Q: BAK Corp. is considering purchasing one of two new diagnostic machines. Either machine would make it…

A: Given

Q: Ten physicians have just completed their residencies in internal medicine and are considering…

A: The Break-even point is the formula used by the management to determine desired minimum sales to be…

Q: You can get a car loan with a term of three years at an APR of 4%. If you can afford a monthly…

A: Borrowed amount refers to the money that is being taken by the borrower from the lender for a…

Q: Consider an economy with two types of firms, S and I. S firms always move together, but I firms move…

A: Given: Probability Return 60% 21% 40% -20%

Q: 1. Use the table below to find the short rate that will prevail in the fourth year. Confirm that the…

A: We have the spot rates for each year. We have to find the short rate for (1 year rate, at the…

Q: What are the formulas to figure out these problems? I have the answer but I want to be able to…

A: There is a well defined formula to find the price of the stock when its expected dividend D1

Q: Bruin, Incorporated, has identified the following two mutually exclusive projects: Year Cash…

A: formula :

Q: Stock A has a mean of 3% and standard deviation of 15%. Stock B has a mean of 8% and standard…

A: A collection of multiple stocks or securities that an investor infused his money into reveals the…

Q: Two 1000 dollar face value bonds are both redeemable at par, with the first having a redemption date…

A: Bond Bonds are a source of financing for businesses. It is a type of financial instrument that…

Q: Using Table 19-1 and 19-2 Calarlate the annual, Semi annual, quarterly and monthlg (in $) for the…

A: In a contract between an insurance policy holder and an insurer or assurer known as life insurance,…

Q: Which is the better investment? 4.6% compounded weekly 4.62% compounded monthly -4.6% compounded…

A: More is the compounding than better is effective rate of return than better is the investment.…

Q: The quoted rate of interest is calculated using the following formula. Quoted Rate = r* + IP +…

A: Given r* = 2% IP = 3% MRP = 3% LP = .6% DRP = .4%

Q: You have $500,000 saved for retirement. Your account earns 5% interest. How much will you be able to…

A: Solution:- An equal amount is saved each period at end of period is known as ordinary annuity.…

Q: d) Your client, Mr. Yeboah, has approached you that he wants to purchase Apolonia Place and…

A: Data available from the main section: i) Firm takes 7.06 years to recover initial investment. ii)…

Q: y holding too much capital may result in the lower the return to shareholders. Explain with some…

A: In the company there is one objective is to increase the return on investment for the shareholders…

Q: According to the latest measures, 1 USD = 147 JPY, 1 EUR = 145.51 JPY, and 1 EUR = 0.95 USD…

A: Given that 1USD = 147 JPY 1 EUR = 0.95 USD 1 EUR = 145.51 JPY The shadow price is here nothing but a…

Q: The cost of equity using the CAPM approach The current risk-free rate of return (TRF) is 4.67% while…

A: We have to find the cost of equity in two different cases, using two different methods.

Q: The MLA investments purchased a machine a few years ago. The original cost of the machine was…

A: Particulars Values Original cost of machine $ 1,40,000.00 Project life 5 years Sale…

Q: Q 19 Rank the following three stocks by their risk-return relationship, best to worst. Rail Haul…

A: Solution: Risk return relationship means the return per unit of risk i.e. the average return per…

Q: The term Capital forbearance refers to: a. Capital injected by the shareholders of a FI for…

A: Forbearance means restraint and tolerance . Capital Forbearance is also known as regulatory…

Q: You want to buy a $175,000 home. You plan to pay 20% as a down payment, and take out a 30 year loan…

A: We have a mortgage transaction on a home. We have to find some amounts based on the mortgage.

Q: 23. Boricua stock is currently trading at a market price (S) of $95. have an options strategy in…

A: Profit to a long position in put option Profit to a long position in put option is calculated as…

Q: Month end contributions of $324 are made to an account for 10 years. For exactly 9 years following…

A: An annuity is a series of payments that are provided for a lump sum amount that is paid today. It is…

Q: Nationgate Corporation is considering two projects of machinery that perform the same task. The…

A: Capital budgeting refers to the process which is used for the evaluation of investments that have…

Q: The current price of a stock is 200, and the continuously compounded annual risk-free interest rate…

A: The current price of a stock is $200 The continuously compounded annual risk-free rate is 4% The…

Q: Ramon Hernandez saw the following advertisement for a used Volkswagen Bug and decided to work out…

A: Here, Particulars Values Cash price $ 7,850.00 Down payment $ - Amount…

Q: Kirby Enterprises's stock is currently selling for $32.45 per share, and the firm expects its…

A: The value of stock can be found as the present value of the dividends and present value of growth…

Q: he balance sheet for Quinn Corporation is shown here in market value terms. There are 12,000 shares…

A: Data given: Market value of equity=$404,300 No. of shares outstanding= 12000 Dividend declared per…

Q: Items 21 to 27 are based on the following information: The balance sheet for the Litex Corporation…

A: Given Notes Receivable = P365,000 Accounts Receivable = P856,000 Interest Receivable = P5,250 Notes…

Q: Consider a European call on Amazon Stock (AMZN) that expires in one period. The current stock price…

A: We can set up a portfolio by taking long position in AMZN and selling a AMZN call option short. We…

Q: Explain the importance of historical financial information

A: The historical financial information of a company is the collection of the financial statements of…

Q: Elite Apparel Inc. is considering two investment projects. The estimated net cash flows from each…

A: NPV is the method of evaluating the annual returns of the project with respect to the estimated…

Q: A friend lends you $830, which you agree to repay with 5% interest. How much will you have to…

A: Given The amount borrowed is $830 Interest rate is 5%

Q: dentify and describe the personal risk that is mitigated by the purchase of disa

A: Insurance are very important in the life due to increased risk in life it is very important to have…

Q: QUESTION 3 You are considering starting a new factory producing small electric heaters. Each unit…

A: concept. capital expenditure means cash outflows due to purchase of capital assets such as property…

Q: Suppose you want to have $600,000 for retirement in 20 years. Your account earns 6% interest. a)…

A: The future value of amount includes the amount being deposited and also the amount of interest…

Q: Examples or violations Real Estate Investment Trust Act of 2009 (RA 9856)

A: Businesses that manage, own, or fund income-producing real estate assets are considered REITs (Real…

Q: WHAT IS A SMART CONTRACT? HOW CAN IT BE USED IN FINANCE?

A: Block technlogy is growing very much now days and it is used in finance quite much and this based on…

Q: Assuming you want to purchase a 5 year bond that has a face value of $20,000 that pays 12% interest.…

A: Solution: Bond price is the price at which a bond is trading in the market. It is calculated by the…

Q: Mersey Chemicals manufactures polypropylene that it ships to its customers via tank car. Currently…

A: Data given: Initial tank car cost=$1.9 million * 2=$ 3.8 million Inflation rate=0% Depreciable life=…

Q: Scheduled payments of $835, $557, and $503 are due in one year, four-and-a-half years, and six years…

A: Time Value of Money states that a dollar earned today is more valuable than any time in the future,…

Q: Ashley Olson is early in her career and is now employed as the managing editor of a well-known…

A: Investment The process that involves investing funds in a project with an aim to obtain maximum…

Q: You want to receive $275 at the end of every three months for 5 years. Interest is 5.7% compounded…

A: Present value refers to the current value of an asset present at some future date. It is helpful…

Q: payback period

A: A project's payback period is the number of years required to recoup the money spent on it. We don't…

Q: banks

A: And we all are aware that both risk and return go together. So if your firm is making more financing…

Q: You have saved $25,000 for a down payment on a house and can afford $1100 per month in payments. If…

A: Maximum Value of house = Down Payment + Present value of monthly payments for 3 years Down Payment…

Q: Purchase price Expected useful life Scrap value Depreciation per year Minimum required rate of…

A: Internal rate of return is one of the capital budgeting methods that are used and at this net…

Q: At the beginning of 2007 (the year the iPhone was introduced), Apple's beta was 1.3 and the…

A: Capital Asset Pricing Model(CAPM) is used to determine the market behavior. The model works on the…

Q: Suppose that you have acquired the exclusive rights to open a Chick-Fil-A on the UNR campus. Setup…

A: The value of an option refers to the premium that is above the intrinsic value. When more time is…

Question

no handwritten answer please thanku

5. Taylor is paid on the last day of the month and 580 is automatically deducted from her pay and deposited in a savings
account. If the account pays 3.6% interest compounded monthly, how how long will it take for the savings account
to reach $10,000? How much of the $10,000 saved is from interest?

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

Introduction

VIEW

Calculation of Number of months and years

VIEW

Calcualtion of Interest

VIEW

Step by step

Solved in 3 steps with 1 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

Refer to the present value table information on the previous page. What amount should Brett have in his bank account today, before withdrawal, if he needs 2,000 each year for 4 years, with the first withdrawal to be made today and each subsequent withdrawal at 1-year intervals? (Brett is to have exactly a zero balance in his bank account after the fourth withdrawal.) a. 2,000 + (2,000 0.926) + (2,000 0. 857) + (2,000 0.794) b. 2,0000.7354 c. (2,000 0.926) + (2,000 0.857) + (2,000 0.794) + (2,000 0.735) d. 2,0000.9264
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 ?
You deposit $650 in a savings account. How long does it take an account with an annual interest rate of 5% to earn $178.25 in interest? Round your answer to the nearest tenth.
Imelda opens a savings account with $12,000, which pays an annual interest rate of 7.8%. If she reinvests the generated interest every month and also deposits $2,300 each month, how much will be in the account after 2 years? The interest is reinvested on the same day as the $2,300 deposit. Otions: 69177.89 71052.15 73548.61 70524.79
If Jackson deposits $120 at the end of each month in a savings account earning interest at a rate of 6%/year compounded monthly, how much will he have on deposit in his savings account at the end of 5 yr, assuming he makes no withdrawals during that period? (Round your answer to the nearest cent.) $ Need Help? Master It
Find each future value of single deposit by using the future value of a single deposit formula. 8. John opens a passbook savings account with $100. It pays 3.5% interest compounded quarterly. What will be the balance after one year?
4. Suppose $5,000 is deposited in a savings and loan account that pays 5.5% interest compounded semiannually. Use compound interest to calculate the following:a. How much money will be saved?b. How much will be owed after 2 years?
How much will be in Amber's bank account after 2 years if the account pays 8% compounded semi-annually if she deposits $800 into the account semi-annually? $10,247.26 $3,397.17 $6,523.69 $8,762.81
If Rita receives $36.44 interest for a deposit earning 6% simple interest for 10 days, what is the amount of her deposit? (Round your answer to the nearest cent.)$
Suppose Jorge Otero has set up an annuity due with a certain credit union. At the beginning of each month, $130 is electronically debited from his checking account and placed into a savings account earning 6% interest compounded monthly. What is the value (in $) of Jorge's account after 17 months?
6. Gracie deposited $20,000 into an account that compounds interest weekly at a rate of 1.56%. Each week her bank withdraws $200 from the account and puts the amount into her mortgage account. How long will it take until the account has a balance of $0?
A family is saving for their child's education. They want to have $80,000 eighteen years from now . a.) How much do they need to deposit each month into an account earning 7.2% interest compounded monthly? b.) What is the interest earned on the account?