You plan to borrow $1000 from a bank. In exchange fro $1000 today, you promise to pay $1080 in one year. What does the cash flow timeline look like from your perspective? What does it look like from the bank's perspective?
Q: An investor have a projected surplus income of P1000 per year which he plans to place in a bank…
A: Periodic Payment = P 1,000 Interest Rate = 18% Time Period = 5 Years
Q: You need to turn $11,827 dollars into $18,864 dollars in 7 years. Assuming you make no extra…
A: Future Value = Present Value * (1+r)^nWhere,r = rate of interest per periodn = no. of compounding…
Q: A father wants to set up a bank account that will pay his daughter $18,000 at the end-of-quarter…
A: It is assumed that the interest rate per quarter is 2%.
Q: Suppose an investment will pay $19,000 in 16 years from now. If you can earn 10.15% interest…
A: Given information: Future value of investment is $19,000 Number of years is 16, Interest rate is…
Q: future value of your money in 17 years.
A: Future Values: Future value is the value that will be increased or decreased after a particular…
Q: a businessman needs to have 100,000 due in 5 years. how much must he put into his 10% saving account…
A: Here in this question, we are required to calculate how much business man should put into investment…
Q: Assume that you want to deposit an amount (BD120,000.00) into an account three years from now in…
A: Time Value of money: Money received today is worth more than money received later, according to the…
Q: How long would it take $1,000 to double if it were invested in a bank that pays 6% per year?
A: Data given is as follows: Investment (Present Value) = $1000 Investment (Future value) = $1000 * 2 =…
Q: You are currently investing your money in a bank account which has a nominal annual rate of 7…
A: The future worth means the amount that is to be received after a certain specified period of…
Q: If you want to have $60.000 in 8 years, how much do you need to deposit in the bank today if the…
A: Deposit required today = FV/(1+r)n Where FV - Future value = $60,000 r - Interest rate = 9% n -…
Q: ose an investment will pay $21,000 in 19 years from now. If you can earn 16.35% interest compounded…
A: The today value will be the present value of future value considering the discount rate and period…
Q: Scott wants to invest RM1,000 for 1 year. At Bank A, his investment will collect 3% interest…
A: Calculate the effective annual rate of return for both the banks and select the bank that offers a…
Q: How much will you need to put in the bank today at 4% interest to have P20,000 in five years?
A: Present value is the sum of the current value of money of future cash flows. It is also known as a…
Q: The following cash flow diagram indicates the yearly payments you will make in the future. Assume…
A: The Present Value of money: The value of a cash stream to be received or paid at some time in the…
Q: Suppose you invested $50,000 into an account at a private bank that attracts annual interest of 20%…
A: The present value of a sum shows the amount of money available today. It is the discounted value of…
Q: You have $300 and a bank is offering 5.5% interest on deposits. If you deposit the money in the…
A: FV = PV * (1 + r)^nWhere FV = Future ValuePV = Present Value = $300r = rate of interest = 5.5%n =…
Q: Suppose you put $200 into a bank account at the annual interest rate of 7%. *Round your answer to…
A: In this we have to find the future value of given value.
Q: You decide to deposit $5000 in a bank account paying 3.5% interest. What is the value of your…
A: Value of saving in 1 year can be calculated using following formula FV = PV* (1 + r / n)nt Where,…
Q: Suppose your bank account will be worth $4,200.00 in one year. The interest rate (discount rate)…
A: Present value is the present worth of any sum of money to be received in the future at a specified…
Q: How much money should a man invest in a bank account paying 8 percent annual interest compounded…
A: Interest Rate = 8% Continuous Compounding Future Value Required = 20,000 T (Time Period) = 4 years…
Q: A man purchases a lot worth 1,000,000 if paid in cash. On installment basis, he paid P200,000 down…
A: Purchase price = 1,000,000 Down payment = 200,000 Payment at the end of year 1 = 300,000 Payment at…
Q: Solve the attachment
A: The amount to be paid at the end can be calculated by adding interest to the opening balance. The…
Q: If you deposit the money in the bank, how much will you have in one year?
A: The time value of money implies that the cash in hand at present has a higher value than the cash…
Q: A bank will pay you $100 a year for your lifetime if you deposit $2,500 in the bank today. If you…
A: In the given question we need to compute the interest rate bank is paying.
Q: Suppose you put $1000 in an account today and you need to have $6727.5 in the future. If the bank…
A: Future value = Present Value * (1+ rate )^ n Where, r = rate of interest n = no. of compounding…
Q: If you put $850 in a bank today that pays (a) 13% interest per year, how much money could be…
A: The concept of the time value of money states that the current worth of money is more than its value…
Q: Mr. Jones is planning a 20-year retirement; he wants to withdraw 300,000 at the end of the first…
A: Withdraw at the end of year = 300,000 Annual increase in withdrawal = 40,000 Period = 20 Years…
Q: Answer and draw neatly the necessary cash flow diagrams, and box your final answers. A student…
A: Effective Rate = 10% Deposit at time 0 = 1500 Deposit for next two years = 3000 Withdrawal after 3…
Q: If you deposit BD1,500 now, BD3,600 three years, BD2000 seven years, and BD1,800 nine years from now…
A: Deposit now = 1500 Deposit in three years = 3600 Deposit in seven years = 2000 Deposit in nine years…
Q: You deposit k1000 in your bank account if the bank pays 4% simple interest,How much will you…
A: The future value is the amount that will be received at the end of a certain period. In simple…
Q: A father wants to set up a bank account that will pay his daughter $12,000 at the end-of-quarter…
A: Quarterly interest rate (r) = 2% We need to equate the present value of deposits with present value…
Q: ered by a bank an interest rate of 6.5% per annum, compounded annually. How much money will the…
A: The given problem can be solved using PV function in excel. PV function computes present worth for…
Q: You want to have $10000 in five years. How much should you deposit today if the bank pays 4%…
A: $10000 in 5 Years That is 5*12 months = 60 Months (n) Interest rate 4% annual compounded monthly…
Q: Solve the following problem. If P100,000.00 is invested in a bank at 4.5% simple interest annually,…
A: Borrowings are the liability that is used to finance the requirement of the funds. The borrower…
Q: You have a bank deposit now worth P15, 000. How long will it take for your deposit to be P20, 000 if…
A: Here the given rate of 12% is the nominal rate and we will have to find the real rate of interest…
Q: K Suppose you receive $500 at the end of each year for the next three years. a. If the interest rate…
A: Present value is the value right now of some amount of money in the future. Formula : PV = FV x…
Q: Calculate how much will Sonja have in a savings account 12 years from now if she deposits RM 3,000…
A: Given in the question: Rate of Interest 10% Period 12 Years Initial Deposit…
Q: How long will it take for your deposit to be P20, 000 if the account pays 12% annually?
A: Future Value: It represents the future worth of an investment cash flow and is computed by…
Q: You are currently investing your money in a bank account which has a nominal annual rate of 7…
A: To estimate how long it will take to double an investment at a given interest rate, we can use the…
Q: A person would want to have K143.33 in 4 years time by depositing a single cash of K100 in a bank…
A: Compound interest is one of the ways that money invested earns interest. In compound interest, the…
Q: You are depositing $3,000 today in an account with an expected rate of return of 10%. If you deposit…
A: Future value can be defined as the worth of money at a future date, computed in accordance with the…
Q: How much is the present value of a perpetuity of P1,000 payable semi-annually if money is worth 5%…
A: Present value of perpetuity is calculated for those securities from which keeps generating cash…
Q: You put $250 in the bank for 5 years at 12%. Using the Future Value of 1 Table, what factor would…
A: The Future Value can be calculated from Future value table using the following formula Future…
Q: If you want to have $60,000 in 8 years, how much do you need to deposit in the bank today if the…
A: Here. Required Amount in 8 Years (FV) is$60,000 Interest Rate (r) is 9% Time Period is 8 years
Q: How many years will it take for you to double your money?
A: Future Value is the accumulation of interest over a specified period of time, on the present value.…
Q: Assume you just deposited $1,000 into a bank account. The current real interest rate is 2% and…
A: Given data; Deposit amount = $1000 real interest rate = 2% inflation rate = 6%
Q: If you deposit some money into a bank account today, to the nearest year, how long will it take to…
A: Calculation of number of years: Answer: Number of years is 4
Q: The bank balance will be $
A: Time value of money (TVM) means that the amount of money received in the present times will have…
You plan to borrow $1000 from a bank. In exchange fro $1000 today, you promise to pay $1080 in one year. What does the cash flow timeline look like from your perspective? What does it look like from the bank's perspective?
Trending now
This is a popular solution!
Step by step
Solved in 3 steps with 2 images
- Suppose your bank account will be worth $4,200.00 in one year. The interest rate (discount rate) that the bank pays is 5%. What is the present value of your bank account today?02a) Why is wealth maximization considered as a better measure than profit maximization? b) You are going to deposit in saving account Tk. 3,00,000 today. You will receive Tk.4,80,000 from the bank at the end of year 7. What will be the rate of interest of yourdeposit? c) Mr. Kobir has been offered to deposit of Tk. 10000 today with an interest rate of 12%.Calculate the value on this opportunity after 5 years, if the interest rate is:(i) Compounded Semi-Annually.(ii) Compounded Monthly. d) Gabrielle just won Tk. 10,00,000 in the state lottery. She is given the option of receivingeither alternative A or B shown in the following table at the end of each of the next 5years. She decides to choose the payment alternative—annuity or the mixed stream ofpayments— that provides the higher future value at the end of 5 years. If Gabrielle canearn 5% annually on her investments, which option should she take? End of year Cash flow stream…You plan to borrow $1,000 from a bank. In exchange for $1,000 today, you promise to pay $1,130 in one year What does the cash flow timeline look like from your perspective? What does it look like from the bank's perspective? What does the cash flow timeline look like from your perspective? (Select the best choice below) O A. Period 0 1 CHE
- A person would want to have K143.33 in 4 years time by depositing a single cash of K100 in a bank that compound interest continuously. What interest rate does this bank give? What will be the interest on interest that he will receive on his investment?You will deposit money into a bank account according to the following schedule: today $425,000 1 year from today $55,000 11 years from today $56,500 17 years from today $22,000 $124,300 19 years from today After 19 years from today, what will be the purchasing power of the money in your bank account, expressed in today's dollars? Your bank pays interest at 4.0000% compounded yearly and inflation is expected to be 3.5000% per year.One can solve for payments (PMT), periods (N), and interest rates (1) for annuities. The easiest way to solve for these variables is with a financial calculator or a spreadsheet. Quantitative Problem 1: You plan to deposit $2,100 per year for 4 years into a money market account with an annual return of 3%. You plan to make your first deposit one year from today. a. What amount will be in your account at the end of 4 years? Do not round intermediate calculations. Round your answer to the nearest cent. $ b. Assume that your deposits will begin today. What amount will be in your account after 4 years? Do not round intermediate calculations. Round your answer to the nearest cent. $ Quantitative Problem 2: You and your wife are making plans for retirement. You plan on living 25 years after you retire and would like to have $95,000 annually on which to live. Your first withdrawal will be made one year after you retire and you anticipate that your retirement account will earn 12% annually. a.…
- You open an account where you deposit $500 today. Further, you deposit $800 at the beginning of next year, withdraw $250 at the beginning of year two and deposit $450 at the beginning of year 3. The return for year 1 is 6%, for year 2 it is -8%, for year 3 it is 4.5% and for year 4 it is -2%. What is your dollar-weighted or money-weighted return (in percent) for the four-year period? Answer to two decimals. O -1.45 -6.95 -11.92You plan to deposit $700 in a bank account now and $200 at the end of one year. If the account earns 3% interest per year, what will the balance be in the account right after you make the second deposit? There will be $ in the account right after the second deposit. (Type an integer or a decimal.) w an example .... Get more help. Save Clear all In(Time Value of Money) Read and analyze each given scenario and provide what is asked. Show your complete solutions. 1. It is now January 1, 20x8. Today you will deposit P100,000 into a savings account that pays 8%. a. If the bank compounds interest annually, how much will you have in your account on January 1, 20x9? b. What will your January 1, 20x9 balance be if the bank uses quarterly compounding? 2. It is now January 1, 2x16, and you will need P100,000 on January 1, 2x20. Your bank compounds interest at an 8% annual rate. How much must you deposit today to have a balance of P100,000 on January 1, 2x20? 3. If you deposited P200,000 in a bank account that pays 6% interest annually, how much will be in your account after five (5) years? 4. What is the present value of a security that will pay P290,000 in 20 years if securities of equal risk pay 5% annually? 5. What is the future value of a 5%, 5-year ordinary annuity that pays P8,000 each year? If this was an annuity…
- Suppose you put $1000 in an account today and you need to have $6727.5 in the future. If the bank pays 10%, how many years (n) will it take you to have $6727.5?Assume that you have $10,000,000 in your bank account. You wish to withdraw $400,000 per year, at the end of each year, for the next 5 years, after which you wish to have $11,000,000 in the bank. What is the balance in your account after the 2nd year (after the withdrawal)? Hint: you will need first to solve for rate in Excel given all other parameters. Watch signs. Select one: a. $10,366,644 b. $10,600,000 c. $9,600,000 d. $10,488,912Please provide the steps to solving this problem using a financial calculator: You just opened a brokerage account, depositing $3,500. You expect the account to earn an interest rate of 9.652%. You also plan on depositing $4,500 at the end of years 5 through 10. What will be the value of the account at the end of 20 years, assuming you earn your expected rate of return?
