2 3. Mr Flint is planning to take a trip around the world twenty years from today. In order to pay for this trip he plans to make equal yearly deposits in years 1-through-11 into an account paying 9% interest compounded annually. He plans to make five $50,000 yearly withdrawals from the account with the first withdrawal occurring twenty years from today. How much must he save each year to provide himself with the necessary spending money for this dream vacation? Answer: 55544.89 Mitchell Investments has offered you an investment opportunity. If you invest $30,000 today you will receive the following cash-flows: *S6,000 each year from years I through *$3,000 each year from years 6 through 10 *$2,000 each year from years 11 through 20 If you required a 9% return on your investments, would this be a good investment opportunity? Show your work and justify your answer. Answer S36,342.29 Janics Street's son, Harold, is 10 years old today. James wants to begin saving money for Harold's college education, which Harold will begin on his eighteenth birthday. James estimates that it will cost $20,000, $22,000, $24,000, and $25.000 for his son's freshmen, sophomore, junior, and senior year respectively. Mr. Street plans to make these amounts available to hiss at the beginning of each of these years. Street would like to make eight annual deposits, the first of which would be made on Harold's eleventh birthday (one year from today) and the last on his eighteenth birthday (the day he leaves for college). These deposits will be made into an account paying 10% interest and he wants the account to be worth enough just to pay for Harold's education. How much will Mr Street have to deposit into this account each year to provide for Harold's education (show all work) Answer: 56875.73 2. 3. Mr Flint is planning to take a trip around the world twenty years from today. In order to pay for this trip he plans to make equal yearly deposits in years 1-through-11 into an account paying 9% interest compounded annually. He plans to make five $50,000 yearly withdrawals from the account with the first withdrawal occurring twenty years from today. How much must he save cach year to provide himself with the necessary spending money for this dream vacation? Answer: 3544.89 Mitchell Investments has offered you an investment opportunity. If you invest $30,000 today you will receive the following cash flows: *$6,000 each year from years 1 through *$3.000 each year from years 6 through 10 *$2,000 each year from years 11 through 20 If you required a 9% return on your investments, would this be a good investment opportunity? Show your work and justify your answer. Answer: 36,342.29 James Street's son, Harold, is 10 years old today. James wants to begin saving money for Harold's college education, which Harold will begin on his eighteenth birthday. James estimates that it will cost $20,000, $22,000, $24,000, and $25,000 for his son's freshmen, sophomore, junior, and senior year respectively. Mr. Street plans to make these amounts available to his son at the beginning of each of these years. Street would like to make eight annual deposits, the first of which would be made on Harold's eleventh birthday (one year from today) and the last on his eighteenth birthday (the day he leaves for college). These deposits will be made into an account paying 10% interest and he wants the account to be worth enough just to pay for Harold's education How much will Me Street have to deposit into this account each year to provide for Harold's education (show all work) Answer: 6875.73 4. 2 3. Mr Flint is planning to take a trip around the world twenty years from today. In order to pay for this trip he plans to make equal yearly deposits in years 1-through-11 into an account paying 9% interest compounded annually. He plans to make five $50,000 yearly withdrawals from the account with the first withdrawal occurring twenty years from today. How much must he save each year to provide himself with the necessary spending money for this dream vacation? Answer: 55544.89 Mitchell Investments has offered you an investment opportunity. If you invest $30,000 today you will receive the following cash-flows: *S6,000 each year from years I through *$3,000 each year from years 6 through 10 *$2,000 each year from years 11 through 20 If you required a 9% return on your investments, would this be a good investment opportunity? Show your work and justify your answer. Answer S36,342.29 Janics Street's son, Harold, is 10 years old today. James wants to begin saving money for Harold's college education, which Harold will begin on his eighteenth birthday. James estimates that it will cost $20,000, $22,000, $24,000, and $25.000 for his son's freshmen, sophomore, junior, and senior year respectively. Mr. Street plans to make these amounts available to hiss at the beginning of each of these years. Street would like to make eight annual deposits, the first of which would be made on Harold's eleventh birthday (one year from today) and the last on his eighteenth birthday (the day he leaves for college). These deposits will be made into an account paying 10% interest and he wants the account to be worth enough just to pay for Harold's education. How much will Mr Street have to deposit into this account each year to provide for Harold's education (show all work) Answer: 56875.73 2. 3. Mr Flint is planning to take a trip around the world twenty years from today. In order to pay for this trip he plans to make equal yearly deposits in years 1-through-11 into an account paying 9% interest compounded annually. He plans to make five $50,000 yearly withdrawals from the account with the first withdrawal occurring twenty years from today. How much must he save cach year to provide himself with the necessary spending money for this dream vacation? Answer: 3544.89 Mitchell Investments has offered you an investment opportunity. If you invest $30,000 today you will receive the following cash flows: *$6,000 each year from years 1 through *$3.000 each year from years 6 through 10 *$2,000 each year from years 11 through 20 If you required a 9% return on your investments, would this be a good investment opportunity? Show your work and justify your answer. Answer: 36,342.29 James Street's son, Harold, is 10 years old today. James wants to begin saving money for Harold's college education, which Harold will begin on his eighteenth birthday. James estimates that it will cost $20,000, $22,000, $24,000, and $25,000 for his son's freshmen, sophomore, junior, and senior year respectively. Mr. Street plans to make these amounts available to his son at the beginning of each of these years. Street would like to make eight annual deposits, the first of which would be made on Harold's eleventh birthday (one year from today) and the last on his eighteenth birthday (the day he leaves for college). These deposits will be made into an account paying 10% interest and he wants the account to be worth enough just to pay for Harold's education How much will Me Street have to deposit into this account each year to provide for Harold's education (show all work) Answer: 6875.73 4