18. Annie O'Malley just turned 19. She decides to save $1 a day and set it aside in a money pouch in her closet. Then, at the end of each year, Annie will deposit the $365 in a savings plan that earns 4.77% compounded annually. How much will Annie have when she turns 50, after her final deposit? 19. Morgan spends $185 a month on sodas and is considering the advantages of drinking water instead. If Morgan just turned 24 and deposits the $185 at the beginning of each month into a savings plan earning 3.5% compounded monthly, how much will she have in her savings plan at age 60? Name Class ANSWERS 18. 19. 20. 21. 20. Refer to Problem 19. What if Morgan makes deposits at the end of each 22. 20 yrs month? 21. Refer to problem 20. How much interest will Morgan's savings plan earn? 22. If you deposit $100 at the end of each month earning 5.75% compounded monthly, what will your balance be in 20 years, 30 years, and 40 years? 23. The average growth rate for a certain blue chip stock over the last 100 years is 10.5%. If your great-great-grandfather had invested $90 in the stock 100 years ago and received the 10.5% return, what would his investment be worth today? 24. Tuition at a local college is currently $3,220 per year. You want your newborn son to attend when he turns 18. If tuition rates are expected to increase at an annual rate of 6%, what will the annual tuition be at the college 18 years from now? 25. Suppose there are an estimated 3,700 gorillas in a certain region. If the gorilla population is decreasing 4% per year, what will the gorilla population be 25 years from now? Unit 12.4 Present value 26. Brian's uncle gives all of his nieces and nephews $4,000 on their 30th birthdays. Brian just turned 21. What is the value of the $4,000 gift, in today's dollars, assuming that Brian can earn 8.3% compounded annually? 27. Neal Surami, an author from Japan, sells the movie rights to his book and will receive 6,000,000 yen at the end of each 6-month period for the next 6 years. Assuming that money is worth 4.35% compounded semiannually, what is the present value of the movie rights? 46 Homework Assignments 30 yrs 40 yrs 23. 24. 25. 26. 27.