Question
1) Compute the future value of $1,000 compounded annually for 20 years at 4 percent.(Do not round intermediate calculations and round your answer to 2
1)
Compute the future value of $1,000 compounded annually for 20 years at 4 percent.(Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) |
Future value | $ |
b. | Compute the future value of $1,000 compounded annually for 15 years at 10 percent.(Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) |
Future value | $ |
c. | Compute the future value of $1,000 compounded annually for 25 years at 4 percent.(Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) |
Future value | $ |
2)
First City Bank pays 6 percent simple interest on its savings account balances, whereas Second City Bank pays 6 percent interest compounded annually. |
If you made a $66,000 deposit in each bank, how much more money would you earn from your Second City Bank account at the end of 10 years?(Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) |
Difference in accounts | $ |
3)One year ago, you invested $2,630. Today it is worth $3,600.50. What rate of interest did you earn?
26.95 percent
36.90 percent
27.49 percent
36.85 percent
36.53 percent
4)
For each of the following, compute the present value(Do not round intermediate calculations and round your answers to 2 decimal places, e.g., 32.16.): |
Present Value | Years | Interest Rate | Future value | |||||
$ | 12 | 6 | % | $ | 14,451 | |||
3 | 12 | 41,557 | ||||||
28 | 13 | 876,073 | ||||||
30 | 10 | 540,164 | ||||||
|
Wilkinson Co. has identified an investment project with the following cash flows: |
Year | Cash Flow | |||||
1 | $ | 850 | ||||
2 | 1,190 | |||||
3 | 1,450 | |||||
4 | 1,600 |
If the discount rate is 7 percent, what is the present value of these cash flows?(Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) |
Present value | $ |
If the discount rate is 16 percent, what is the present value of these cash flows?(Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) |
Present value | $ |
If the discount rate is 30 percent, what is the present value of these cash flows?(Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) |
Present value | $ |
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