Question
1a. You are offered a court settlement in the following terms: you will receive 5 equal payments of $6,900 each every year, with the first
1a. You are offered a court settlement in the following terms: you will receive 5 equal payments of $6,900 each every year, with the first payment being made 3 years from now. The current annual interest rate is 5%. Assume yearly compounding. What is this settlement worth in present value terms? ROUND TO 2 DECIMAL PLACES.
1b. You are offered a court settlement in the following terms: you will receive 5 equal payments of $6,900 each every year, with the first payment being made 3 years from now. The current annual interest rate is 5%. Assume yearly compounding. What is this settlement worth in present value terms? ROUND TO 2 DECIMAL PLACES.
1c.You are considering making a one-time deposit of $6,741 today, in a bank that offers an interest rate of 8% APR. If you leave your money invested for 3 years, how much money will you have at the end of this period? Consider monthly compounding. ROUND TO 2 DECIMAL PLACES.
1d. Assume that you wish to make annual deposits into a savings account. The interest rate offered by the bank is 4%, and you plan to save for the next 8 years. If your goal is for the present value of your savings to be equal to $2,082, how much money must you deposit every year? ROUND TO 2 DECIMAL PLACES.
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