Answered: Would you rather have $463 now or…

Business

Accounting

Would you rather have $463 now or $1,000 ten years from now? Assume that you can earn 9% on your investments.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Related questions

Q: 0 years at an 6.9% rate of return you'll have accumulated? keep 2 d

A: To know the accumulated amount, future value of the investment amount or principal amount is to be…

Q: ould you need to invest today at a lump sum at 10.5% compounded continuously, to have $200,000 in…

A: Compounding continuously is exponential form of money growth but it is an imaginary and theoretical…

Q: You are offered $80,000 today or $300,000 in 11 years. Assuming that you can earn 14 percent on…

A: Choosing between $80,000 today and $300,000 in 11 years:Considering the time worth of money and the…

Q: Suppose you inherited $1,000,000 and invested it at 12.00% per year. How much could you withdraw at…

A: An annuity is a series of future payments that are provided in return for a lump sum investment at…

Q: Assume you can earn 9% per year on your investments. a. If you invest $10,000 for retirement at age…

A: A current asset's future value which is based on an estimated rate of growth is its value at a later…

Q: years from today, and 2,000 four years from today. What will the value of your account be 4 years…

A: The future value is the estimated value of an investment that accounts for compound interest or…

Q: You have $15,000 that you would like to invest for the next 32 years. One option is to invest the…

A: One way to calculate the future value of any invest is to calculate its value after specific period…

Q: You invest $3,806.00 at the beginning of every year and your friend invests $3,806.00 at the end of…

A: Future value is the estimation of future cash value which is likely to be received in the future…

Q: You are planning to save for retirement over the next 15 years. To do this, you will invest $1,100 a…

A: Here, Particulars Stock Bond Monthly deposits (PMT) $1,100.00 $500.00 Interest rate 8.00%…

Q: bjective is to save $500,000 for preparing your retirement, assuming 30 years from now. If you…

A: Future value=$500000Period=n=30 yearsInterest rate=r=10%

Q: An investment product promises to pay you PHP20,000 in dividends every year forever. What is the…

A: Perpetuity means infinite no. of payments which are same in size or can be grown with constant rate,…

Q: You are trying to decide how much to save for retirement. Assume you plan tpo save $4.000 per year…

A: Here, To Find: Part A. No. of years required to exhaust the savings =? Part B. Rate of return need…

Q: You plan on investing $1.900 every 4 years while earning 6% per year. How much money will you have…

A: Future value refers to the concept of time, the value of money which is used for computing the value…

Q: Should you take the $1,600,000 now, or wait to get the full $2,000,000 in 10 years? Why or why not?…

A: Future value of money is the amount of interest accumulated over the period of time of deposit and…

Q: How much you have to invest each year to reach the goal (assume end of year investments and an…

A: The retirement corpus is 750,000. To calculate the end of year payments, the PMT function in excel…

Q: What is the relationship between present value and future value?

A: Future Value : FV is that value which will be received in near future. Present Value : PV is that…

Q: How much will you need to invest today at 10% to have $10,000 six years from today?

A: Using excel PV function Where, PV = present value NPER = no. of years FV = future value

Q: you expect to receive 10,000 at graduation in two years. you plan on investing it at 11% until you…

A: Future amount can be calculated as follows:= Present Value * (1 + rate)^ periods

Q: Assume you can earn 9.5% per year on your investments. a. If you invest $200,000 for retirement at…

A: Annual interest rate = 9.5%

Q: You are invited to participate in an investment that will increase your wealth by 120% in 8 years.…

A: Rate of return is the amount of profit earned on the investment that is being made initial.

Q: Say you want to invest a certain amount of your salary each year. This year you take $2,500 out of…

A: The value of current payment or upcoming flow of payments at any future date when flow of payment…

Q: 9) If you have $1,000 today and want to invest it at 7% per year, how much will you have after 12…

A: The objective of this question is to calculate the future value of an investment given the present…

Q: Suppose a person has a retirement investment portfolio that consistently earns 5.1% annually. In…

A: Perpetuity is an annuity that continues for an indefinite period. In perpetuity series of cash flows…

Q: If you invest $10,000 today at 4% how much money will you have in ten years?

A: We need to calculate the future value from the following details: Present value (invest today) =…

Q: Today, you decide to invest $7,000 for 29 years. If you can earn 9.05 percent for the first 19 years…

A: Here, Invetsment Amount $ 7,000.00Time Period of Invetsment29Interest Rate for first 19…

Q: how much should you invest now in a single investment if you expect to withdraw $45,000 in 9 years…

A: Step 1: Introduction Present Value: The value of the money identified today for the money/sum of…

Q: You plan on saving $15,200 this year, nothing next year, and $17,500 the three years after that. You…

A: The concept of time value of money will be used here. As per the concept of time value of money the…

Q: If you were to invest $50,000 from you lottery winnings today, how much will it be worth in 20 years…

A: To find the future value after some specific some time can be found out by the formula of future…

Q: Assume you can earn 9% per year on your investments. a. If you invest $100,000 for retirement at age…

A: A current asset's future value which is based on an estimated rate of growth is its value at a later…

Q: Suppose you found an investment that earns 6.0% each year. Suppose you want to withdraw 24,000…

A: Given information: Investment earns 6% Future value is $24,000 Number of years is 4

Q: If I invest $1000 at 3% interest, how long will take for my money to double?

A: The number of intervals is the sum of time between the present and the future.

Q: You invest $50,000 for three years that will earn 3.6 percent compounded continuously. What will be…

A: Given Information: Amount invested=$50,000 Interest Rate=3.6% compounded continuously Time(in…

Q: If you invest $10,000 today at 4% how much money will you have in five years?

A: Details given are : Present value (invest today) = $10000 Interest rate = 4% Time period = 5 years…

Q: You want to invest $ 5000 at 9.5 % p. a. and have it grow to $ 6000. How many years should the term…

A: If interest is not compoundingFuture value = Principal +interest Interest = Principal * rate of…

Q: Suppose you are committed to owning a $346,000 Ferrari. If you believe your mutual fund can achieve…

A: The time value of money is the concept that money received today is worth more than the same amount…

Q: 4.2 Calculating Present Values Suppose you have just celebrated your 19th birthday. A rich uncle set…

A: The worth of the fund today can be calculated with the help of present value function

Q: How much time will it take you to accumulate $500,000, assuming you invest $15,000 today and $150 /…

A: The time value of money concept states that the value of a certain amount of money on the future…

Q: If you invest $10,000 today for 8 years, how much will the original investment be worth if…

A: Solution:When some amount is invested somewhere, it earns interest on it.The amount initially…

Q: we have $1,000 and we are offered to put it in investments that will double this money in 8 years,…

A: Future Value is the value of current investments at a certain future date at the assumed interest…

Q: Assume you want to retire in 35 years and save a $15,000 at the end of the first year. Assume you…

A: The time value of money refers to the concept the money when invested at an interest rate for the…

Q: If you invest $56,000 today in an account that pays 8.3% a year, how much will you have in 31 years?…

A: Present Value, PV = $56,000 Interest rate, r = 8.3% Number of periods, n = 31 yearsThe future value…

Q: You expect to receive $150,000 per year on a contract that will last 5 years. You are trying to…

A: Present value of future cash inflows will be equal to the worth of contract today. Worth of…

Q: You would like to have $19,928 in 12 years. If the rate is 8.45%, how much do you have to invest…

A: Future value required (FV) = $19928 Interest rate (r) = 8.45% Number of annual deposits (n) = 12

Q: Suppose you invest $1000 and two years later you cash out for $1300. Your internal rate of return is…

A: in this we have to find out interest rate using future value formula.

Q: Your friend told you about an NFT (Non-fungible Token) that they think will be worth $996 in 6…

A: The concept of money's time value reveals that since any amount today can be invested and grown,…

Q: 5. An investor is considering an investment that will pay $2,150 at the end of each year for the…

A: Payment = p = $2150Time = t = 10Interest Rate = r = 18%

Question

Would you rather have $463 now or $1,000 ten years from now? Assume that you can earn 9% on your
investments.

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

This is a popular solution!

SEE SOLUTION Check out a sample Q&A here

Step 1

VIEW

Step 2

VIEW

Trending now

This is a popular solution!

Step by step

Solved in 2 steps with 2 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, accounting and related others by exploring similar questions and additional content below.

Similar questions

You invest $4,716.00 at the beginning of every year and your friend invests $4,716.00 at the end of every year. If you both earn an annual rate of return of 8.06%, how much more money will you have after 23.0 years?
How much would have to be deposited today in an investment found paying j12 = 10.4% to have $200 in 3 years? time.
You have $76,000 in your account that you want to grow to triple that amount in 25 years. What annual rate of return is necessary to reach your goal? (Note: Enter your answer is a decimal, not a percentage. For example, enter .0452 instead of 4.52%) Your Answer: Answer
You plan to retire in 20 years. Use present value tables to calculate whether it is better for you tosave $25,000 a year for the last 10 years before retirement or $15,000 for each of the 20 years.Assume you are able to earn 10 percent interest on your investments. Round to the nearest dollar.
Double your money—Rule of 72. Approximately how long will it take to double your money if you get an annual return of 3.6%, 6.3%, or 9.1% on your investment?
You currently have $15,804. You plan on investing it at 20 percent per year until you have $68,555. How long will you wait until you achieve this goal? Enter the answer with 2 decimals (e.g. 1.23).
You want to invest $100.00 for three years at 10%. What will the $100 dollars grow to?
Assume you can earn 9.4% per year on your investments. a. If you invest $170,000 for retirement at age 30, how much will you have 35 years later for retirement? b. If you wait until age 40 to invest the $170,000, how much will you have 25 years later for retirement? c. Why is the difference so large? a. If you invest $170,000 for retirement at age 30, how much will you have 35 years later for retirement? The future value is $ (Round to the nearest dollar)
You have a chance to buy an annuity that pays $1,000 at the end of each year for 5 years. You could earn 6% on your money in other investments with equal risk. What is the most you should pay for the annuity?
You are going to retire in 40 years and currently have $100,000. What average annual return would you have to earn on your investment to have $1 million by the time you retire?
D. If you invest $10,000 today at 8% how much money will you have in ten years?
You just deposited $6, 500 in an investment account and will deposit $ 5000 more four years from now. Use tabulated factor values to determine how much will be in the account 11 years from now if the rate of return is 10% per year? 11 years from now, the account will have $.