You deposit $1.000 one year, $2000 next year and withdraw $1000 other year starting year I until year 30 with an interest rateof 5% one year., 6% next year, and 7% other year. How much money will you have at the end of year thirty if there aredifferent interest rates as shown in the diagram belowe1000100010001000262829 302.7%5%6%7%6% 7%S% 6%F?1000 20001000 200020001000 2000Select one:O a. 55698O b. 45000O c. 72333O d. 56187O e. 47566

This problem can be simplified by converting into three years period.

u deposit $1.000 one year. $2000 next year and withdraw $1000 other year starting year I until year 30 with an interest rate 5% one year, 6% next year, and 7% other year, How mUch money will you have at the end of year thirty if there are ferent interest rates as shown in the diagram belowe 1000 1000 1000 1000 28 29 30 5% 6% 7% 5% 6% 7% 7% 5% 6% 1000 2000 1000 2000 2000 1000 2000 plect one: 2 a. 55698 D b. 45000 D c. 72333

u deposit $1.000 one year. $2000 next year and withdraw $1000 other year starting year I until year 30 with an interest rate 5% one year, 6% next year, and 7% other year, How mUch money will you have at the end of year thirty if there are ferent interest rates as shown in the diagram belowe 1000 1000 1000 1000 28 29 30 5% 6% 7% 5% 6% 7% 7% 5% 6% 1000 2000 1000 2000 2000 1000 2000 plect one: 2 a. 55698 D b. 45000 D c. 72333

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

Similar questions

1 Borrow $178,000 at 5.25% for 30 years 2 Borrow $178,000 at 4.00% for 15 years What are the 2 payments? How much interest is paid out under each loan? How much is saved with the 15 year note? And, where does the saved interest end up?
Accounting What is the value of the following payment stream 1 year from now, at a simple interest rate of 4.4%. $10,000 3-years ago, $6,000 1.25 years ago, $12,000 due in 3 years, $18,000 due in 5 years. What is the value of the payment stream at the focal date?
4f
217. Subject : - Finance
Q3. You borrow $5000 today. The loan is due in 5 years, with interest at ji = 7%. It is agreed that you can instead pay $1000 one year from now, $X two years from now and $2000 three years from now. If money is worth j4= 8%, what is the value of X?
2. Problem 5.17 (Effective Interest Rate) еВook You borrow $225,000; the annual loan payments are $30,017.40 for 30 years. What interest rate are you being charged? Round your answer to the nearest whole number. %
Q1. You have been told that you need $x today in order to have $100,000 when you retire 20 years from now. The annual interest rate is 5% on average. Computex. Answer Q2. You plan to make a $40,000 contribution to your individual retirement account, at 3.5 percent per year on average. Compute how much it will be worth if you deposit it for 25 years. Answer Q3. Repeat Q1-Q2, when the interest rate is being componded every SIX MONTHS (or SEMIANNUALLY). Answer Q4. Erica is purchasing a financial instrument that will pay $5,000 a year for seven years, at the end of every year. How much should she pay for this investment today if she wishes to earn a 12 percent rate of return? Answer Q5. Repeat Q5, when you are committed to making contributions at the beginning of every year. Answer Q6. Solve for x: Jane recently purchased a new home with a mortgage of $x. She financed it at 6.6 percent interest with annual installments of $36,000 for thirty years. Answer Q7. Solve for x: Jane recently…
A).$4500 will be paid 6 years and 10 months now. Find present value of payment if interest is at rate j2 = 9%. Use the practical metho. B). An investment fund guarantees to double your money in five years. What rate of j2 is implied ? C). If money doubles at certain rate of interest compound monthly in six years. How long will it take to the same amount of money to triple in valuy ?
Help!8
K (Comprehensive problem) You would like to have $60,000 in 16 years. To accumulate this amount, you plan to deposit an equal sum in the bank each year that will earn 10 percent interest compounded annually. Your first payment will be made at the end of the year. a. How much must you deposit annually to accumulate this amount? b. If you decide to make a large lump-sum deposit today instead of the annual deposits, how large should this lump-sum deposit be? (Assume you can earn 10 percent on this deposit.) c. At the end of five years, you will receive $15,000 and deposit this in the bank toward your goal of $60,000 at the end of year 16. In addition to the lump-sum deposit, how much must you deposit in equal annual amounts, beginning in year 1 to reach your goal? (Again, assume you can earn 10 percent on your deposits.) a. How much must you deposit annually to accumulate this amount? (Round to the nearest cent.) ...
4. If you receive $116 each month for 28 years and the discount rate is 0.08, what is the present value? (show the process and can use financial calculator)
3

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