Basics Of Engineering Economy
2nd Edition
ISBN: 9780073376356
Author: Leland Blank, Anthony Tarquin
Publisher: MCGRAW-HILL HIGHER EDUCATION
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Question
Chapter 3, Problem 14P
(a):
To determine
Identify the time period.
(b):
To determine
Identify the new time period.
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Find the periodic payments PMT necessary to accumulate the given amount in an annuity account. (Assume end-of-period deposits and compounding at the same intervals as
deposits. Round your answer to the nearest cent.)
$80,000 in a fund paying 3% per year, with monthly payments for 10 years
PMT = $
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A credit card company wants your business. If you accept their offer and use their card, they will deposit 1.5% of your
monetary transactions into a savings account that will earn a guaranteed 6% per year. If your annual transactions total
an average of $23,000, how much will you have in this savings plan after 17 years?
Click the icon to view the interest and annuity table for discrete compounding when /= 6% per year.
The amount you will have in this savings plan after 17 years equals $(Round to the nearest cent.)
You want to borrow $41,611. You must repay the loan in 13 years in equal monthly payments and a single $3,960 payment at the end of 13 years. The interest rate is 15% nominal per year. What is the amount of each payment?
Chapter 3 Solutions
Basics Of Engineering Economy
Ch. 3 - Prob. 1PCh. 3 - Prob. 2PCh. 3 - Prob. 3PCh. 3 - Prob. 4PCh. 3 - Prob. 5PCh. 3 - Convert an interest rate of 1.5% per month into a...Ch. 3 - Prob. 7PCh. 3 - Prob. 8PCh. 3 - Prob. 9PCh. 3 - Prob. 10P
Ch. 3 - Prob. 11PCh. 3 - Prob. 12PCh. 3 - Prob. 13PCh. 3 - Prob. 14PCh. 3 - Prob. 15PCh. 3 - Prob. 16PCh. 3 - Prob. 17PCh. 3 - Prob. 18PCh. 3 - Prob. 19PCh. 3 - Prob. 20PCh. 3 - Prob. 21PCh. 3 - Prob. 22PCh. 3 - Prob. 23PCh. 3 - Prob. 24PCh. 3 - Prob. 25PCh. 3 - Prob. 26PCh. 3 - Prob. 27PCh. 3 - Prob. 28PCh. 3 - Prob. 29PCh. 3 - Prob. 30PCh. 3 - Prob. 31PCh. 3 - Prob. 32PCh. 3 - Prob. 33PCh. 3 - Prob. 34PCh. 3 - Prob. 35PCh. 3 - Prob. 36PCh. 3 - Prob. 37PCh. 3 - Prob. 38PCh. 3 - Prob. 39PCh. 3 - Prob. 40PCh. 3 - Prob. 41PCh. 3 - Prob. 42PCh. 3 - Erbitux is a colorectal cancer treatment drug that...Ch. 3 - Prob. 44PCh. 3 - Prob. 45PCh. 3 - Prob. 46PCh. 3 - Prob. 47PCh. 3 - Prob. 48PCh. 3 - Prob. 49PCh. 3 - Prob. 50PCh. 3 - Prob. 51PCh. 3 - Prob. 52PCh. 3 - Prob. 53PCh. 3 - Prob. 54PCh. 3 - Prob. 55PCh. 3 - Prob. 56PCh. 3 - Prob. 57PCh. 3 - Prob. 58PCh. 3 - The initial cost of a pulverized coal cyclone...Ch. 3 - Prob. 60PCh. 3 - Prob. 61PCh. 3 - Prob. 62PCh. 3 - Prob. 63PCh. 3 - Prob. 64PCh. 3 - Prob. 65PCh. 3 - Prob. 66PCh. 3 - Prob. 67PCh. 3 - Prob. 68APQCh. 3 - Prob. 69APQCh. 3 - Prob. 70APQCh. 3 - Prob. 71APQCh. 3 - Prob. 72APQCh. 3 - Prob. 73APQCh. 3 - Prob. 74APQCh. 3 - Prob. 75APQCh. 3 - Prob. 76APQ
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- a) An individual deposits $8,000 semiannually every six months into a savings account. How much does the individual have at the end of 8 years, assuming that she is able to invest her funds at a nominal rate of 14% compounded semiannually?arrow_forwardYou have borrowed $10,000 from a bank with the understanding that you will pay it off with a lump sum of $12,000 after 2 years. Find theannual rate of interest on this loan.arrow_forwardFind the periodic payments PMT necessary to accumulate the given amount in an annuity account. HINT [See Quick Example 2.] (Assume end-of-period deposits and compounding at the same intervals as deposits. Round your answer to the nearest cent.) PMT= $ $30,000 in a fund paying 7% per year, with monthly payments for 5 years Xarrow_forward
- Compare the interest earned by $10,000 for three years at 7% simple interest with interest earned by the same amount for three years at 7% compounded annually. Why does a difference occur? Click the icon to view the interest and annuity table for discrete compounding when i = 7% per year. The simple interest earned is $ The compound interest earned is $ (Round to the nearest dollar.) (Round to the nearest dollar.) There is a difference in the amount of interest earned because original principal. allows interest from previous years to earn additional interest, whereas only considers thearrow_forwardWhile planning for his retirement, Alishan purchased an annuity that paid him $3200 every year for 13 years at a rate of 3.8% compounding semi-annually. What was Alishan's initial investment into the annuity? How much would he receive in payments? How much of that would be interest?arrow_forwardYou have just taken out a mortgage for $575,000, at a fixed rate of 4.75% per year, compounded monthly, and a term of 30 years. a) Calculate the monthly payments b) For the first six months' payments, calculate the portion that is interest and the portion that is principalarrow_forward
- Find i (the rate per period) and n (the number of periods) for the following loan at the given annual rate. Semiannual payments of $4,200 are made for 13 years to repay a loan at 7% compounded semiannually. (Type an integer or decimal rounded to four decimal places as needed.)arrow_forwardLeon and Heidi decided to invest $3,000 annually for only the first seven years of their marriage. The first payment was made at age 20. If the annual interest rate is 9%, how much accumulated interest and principal will they have at age 65? Click the icon to view the interest and annuity table for discrete compounding when i=9% per year. Question content area bottom Part 1 The accumulated interest and principal will equal (Round to the nearest dollar.)arrow_forwardIf the nominal interest is 12% compounded continuously, compute the effective annual rate of interest.arrow_forward
- Question 1 Vince loaned a certain amount from a cooperative and promised to pay it back with 2.32 times his original loaned amount. They agreed a nominal interest rate of 9.29% compounded every 4 months every year for n years. How many n years before he pay all his loan with interest? Answer rounded off with two 2 decimal places.arrow_forwardMr. Smith is planning his retirement. He has decided that he needs to withdraw $12000 per year from his bank account to supplement his other income from Social Security and a private pension plan. How much money should he plan to have in the bank at the start of his retirement, if the bank pays 10% per year, compounded annually, and if he wants money to last for a 12-year retirement period?arrow_forwardCompare the interest earned by $10,000 for three years at 9% simple interest with interest earned by the same amount for three years at 9% compounded annually. Why does a difference occur? Click the icon to view the interest and annuity table for discrete compounding when i=9% per year. The simple interest earned is (Round to the nearest dollar.) (Round to the nearest dollar.) The compound interest earned is $ There is a difference in the amount of interest earned because compound interest allows interest from previous years to earn additional interest, whereas simple interest only considers the original principal.arrow_forward
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