21.

What will be the approximate population of the United States, if its current population of

316

,000,000

grows at a compound rate of 2

.

3

% annually for

30

years?

(Enter your answer rounded to the nearest

whole number; for example, record 218

,

934

,210.86

as

218934211

).

22.

Assume that a gallon of milk costs $

3.

50

today. If the average annual inflation rate over the past

35

years was 2.75% p.a., what did a gallon of milk cost

35

years ago?

23.

What is the future value on the day of the last deposit of

2

5

annual deposi

ts of $

75

0 per year (first

deposit to be made today) given an interest rate of 5.5% p.a.?

24.

Assume that I

will

deposit $750 into an account exactly 10 years from today. How much will be in my

account at the end of year

60

(i.e., 60 years from today)

, assumin

g that my account pays interest of

4

.5% p.a.?

25.

The ShortHolder bank pays 5.60%

p.a.

,

but with daily compounding assume a

360

-

day

year

), on a 9

-

month certificate of deposit. If you

deposit $20,000 you would expect to earn

__________ in interest

(rounded to the nearest dollar)

.

26.

With continuous compounding at 8

% p.a.

for 20 years, what is the approximate future value of a

$20,000 initial investment

(rounded to the nearest dollar)

?

27.

For $1,000

Laura Croft

can purchase a 5

-

year ordinary annuity which will pay

her

a yearly payment

of $263.80 for 5 years. What is the annual interest rate implicit

in this investment

? Round your

an

swer to the near

est tenth (for example, record 0.4325 as 43.3%

-

but do not include the percent sign

in iCollege)

.

28.

Nathan Drake is

considering borrowing $100,000 for 30 years at a compound annual interest rate of

9

% p.a.

The

loan agreement calls for 30 equal annual payments, to be paid at the end of each of the

next 30 years

(p

ayments include both principal and interest.)

What is the annual payment that will

fully amortize

Nathan

'

s

loan?

29.

Cl

oud Strife is

going to place $12,500 into a certificate of deposit (CD) at a 6% annual rate

(compounded annually) with a maturity of 30 months. How much money will

Clou

d

receive when the

CD matures?

30.

Clementine and Lee

expect to deposit the following cash flows at the end of years 1 through 5,

$1,000; $4,000; $9,000; $5,00

0; and $2,000 respectively. Alternatively,

they

could deposit a single

amount today

and have the same amount in your account at the end

of y

ear 5

. How large does the

single deposit need to be today if

Clementine and Lee

can earn 10% compounded annually

on their

account

?

Part II: PROBLEMS 7 Compute a nal numerical answer for each of the following problems. Unless specically instructed in a question to do otherwise, round all dollar answers to 2 decimal places, round time (years or months) answers to one (1) decimal place and record interest rates as percent values rounded to one (1) decimal place. However, be sure to NOT input a dollar sign, commas, or a percent sign on iCollege. For example, record $3,284.33965 as 3284.34, record 37.285432 years as 37.3 and record .064358 = 6.4358% as 6.4. 21. 22. 23. 24. 25. 26. 27. 28. 29. 30. 31. 32. What will be the approximate population of the United States, if its current population of 316,000,000 grows at a compound rate of 2.3% annually for 30 years? (Enter your answer rounded to the nearest whole number; for example, record 218,934,21086 as 218934211). Assume that a gallon of milk costs $3.50 today. If the average annual ination rate over the past 35 years was 2.75% pa, what did a gallon of milk cost 35 years ago? What is the future value on the day of the last deposit of 25 annual deposits of $750 per year (rst deposit to be made today) given an interest rate of 5.5% p.a.? Assume that I will deposit $750 into an account exactly 10 years from today. How much will be in my account at the end of year 60 (i.e., 60 years from today), assuming that my account pays interest of 45% pa? The ShortHolder bank pays 5.60% pa, but with daily compounding assume a 360-day year), on a 9- month certicate of deposit. If you deposit $20,000 you would expect to earn in interest (rounded to the nearest dollar). With continuous compounding at 8% pa. for 20 years, what is the approximate future value of a $20,000 initial investment (rounded to the nearest dollar)? For $1,000 Laura Croft can purchase a 5-year ordinary annuity which will pay her a yearly payment of $263.80 for 5 years. What is the annual interest rate implicit in this investment? Round your answer to the nearest tenth (for example, record 0.4325 as 43.3% - but do not include the percent sign in iCollege). Nathan Drake is considering borrowing $100,000 for 30 years at a compound annual interest rate of 9% pa. The loan agreement calls for 30 equal annual payments, to be paid at the end of each of the next 30 years (payments include both principal and interest.) What is the annual payment that will fully amortize Nathan's loan? Cloud Strife is going to place $12,500 into a certicate of deposit (CD) at a 6% annual rate (compounded annually) with a maturity of 30 months. How much money will Cloud receive when the CD matures? Clementine and Lee expect to deposit the following cash ows at the end of years 1 through 5, $1,000; $4,000; $9,000; $5,000; and $2,000 respectively. Alternatively, they could deposit a single amount today and have the same amount in your account at the end of year 5. How large does the single deposit need to be today if Clementine and Lee can earn 10% compounded annually on their account? What is the future value at the end of year 18 of $10,000 deposited today into an account that pays interest of 4.5% p.a., but with daily compounding (assume 365 days per year)? Ellie is evaluating an investment that will provide the following returns at the end of each of the following years: year 1, $11,500; year 2, $10,000; year 3, $7,500; year 4, $5,000; year 5, $2,500; year 6, $0; and year 7, $12,500. Ellie believes that she should earn an annual rate of 8 percent on this investment. How much should Ellie pay for this investment