Essentials Of Investments
Essentials Of Investments
11th Edition
ISBN: 9781260013924
Author: Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher: Mcgraw-hill Education,
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What lump sum do parents need to deposit in an account earning 10%, compounded monthly, so that it will grow to $70,000 for their son's college fund in 13 years? (Round your answer to the nearest cent.)
$
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Transcribed Image Text:What lump sum do parents need to deposit in an account earning 10%, compounded monthly, so that it will grow to $70,000 for their son's college fund in 13 years? (Round your answer to the nearest cent.) $
Jake Werkheiser decides to invest $8000 in an IRA at the end of each year for the next 6 years. If he makes these investments, and if the certificates pay 8%, compounded annually, how much will he have at the end of the 6 years? (Round your answer to the nearest cent.)
$
X
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Transcribed Image Text:Jake Werkheiser decides to invest $8000 in an IRA at the end of each year for the next 6 years. If he makes these investments, and if the certificates pay 8%, compounded annually, how much will he have at the end of the 6 years? (Round your answer to the nearest cent.) $ X
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Step 1

As per our guidelines we are supposed to answer only one question (if there are multiple questions asked).

Request you to re-post the remaining question.

 

Data given:

r= 10% compounded monthly

FV= $70,000

N=13 years

 

Working Note #1

Monthly rate = 10%/12= 0.008333

 

Working Note #2

Period(n) =N*t= 13 years *12 =156

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