you want to establish an annuity that will pay $7,500 for the next twenty years (end year) your financial institution will establish such an annuity if you deposit $104,000 today. what is the implied rate that the institution is paying on this annuity?
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- You want to invest $8,000 at an annual Interest rate of 8% that compounds annually for 12 years. Which table will help you determine the value of your account at the end of 12 years? A. future value of one dollar ($1) B. present value of one dollar ($1) C. future value of an ordinary annuity D. present value of an ordinary annuityWhat is the value of a 30-year annuity that pays $2500 a year? The annuity’s first payment will be received on year 11. Also, assume that the annual interest rate is 4 percent for years 1 through 10 and 5 percent hereafter.What’s the present value of a perpetuity that pays $1,000 per year beginning1 year from now, if the appropriate interest rate is 5%? What would the valuebe if payments on the annuity began immediately? ($20,000, $21,000.Hint: Just add the $1,000 to be received immediately to the value of theannuity.)
- A perpetuity will pay $1,000 per year, starting five years after the perpetuity is purchased. What is the future value (FV) of this perpetuity, given that the interest rate is 3%?A perpetuity will pay $1000 per year, starting five years after the perpetuity is purchased. What is the future value (FV) of this perpetuity, given that the interest rate is 3%?You would like to have enough money saved to receive a $90,000 per year perpetuity after retirement. The annual interest rate is 8 percent. Required: How much would you need to have saved in your retirement fund to achieve this goal? a) Assume that the perpetuity payments start on the day of your retirement. b) Assume that the perpetuity payments start one year from the date of your retirement.
- It is estimated that you will pay about $80,000 into the Social Security system (FICA) over your 40-year work span. For simplicity, assume this is an annuity of $2,000 per year, starting with your 26th birthday and continuing through your 65th birthday. Solve, a. What is the future equivalent worth of your Social Security savings when you retire at age 65 if the government’s interest rate is 6% per year? b. What annual withdrawal can you make if you expect to live 20 years in retirement? Let i= 6% per year.A perpetuity will pay $800 per year, starting five years after the perpetuity is purchased. What is the present value (PV) of this perpetuity on the date that it is purchased, given that the interest rate is 3%?How much would you be willing to pay today for an ordinary annuity that makes equal annual payments of $3,000 each year. You will receive your first payment 7 years from today and you will receive your last payment 32 years from today. The interest rate on this annuity is 4.1%.
- You are offered an annuity that will pay $11,000 per year for 24 years (the first payment will occur one year from today). If you feel that the appropriate discount rate is 12%, what is the annuity worth to you today? $914,490.09 $1.299,707.65 $95,902.77 $1,455,672.57 $85.627.47 You are told that if you invest $10,900 per year for 12 years (all payments made at the end of each year) you will have accumulated $670,000 at the end of the period. What annual rate of return is the investment offering? 29.99% 23.63% 20.63% 26.99% 33.44%A perpetuity will pay $900 per year, starting five years after the perpetuity is purchased. What is the present value (PV) of this perpetuity on the date that it is purchased, given that the interest rate is 11%?Determine the annual payment required to fund a future annual annuity of $12,000 per year. You will fund this future liability over the next five years, with the first payment to occur one year from today. The future $12,000 liability will last for four years, with the first payment to occur seven years from today. If you can earn 8 percent on this account, how much will you have to deposit each year over the next five years to fund the future liability?