#7

5, (15%) You are given: ine aiahe of the second fund. Calculate. . A payment of z at time 2 plus a payment of y at time 6 is equivalent to a payment of z + at time 4 +y 2000. . The annual effective rate of interest is 3.5%. Calculate z 6, (15%) Investor A deposits 1,000 into an account paying 4% compounded quarterly. At the end of three years, he deposits an additional 1,000. Investor B deposits X into an account with force of interest d After five years, investors A and B have the same amount of money. Find X: 7. (10%) Using the method of equated time, a payment of 1200 at time t-2 plus a payment of z at time t 6 is equivalent to a payment of 1200+x at time t 3.6. At an effective annual rate of 6.45%, the above two payments are equivalent to a payment of 1200+x at time t using the exact method. Calculate t 8, (10%) For an investment account, you are given: 1/1/96 3/1/96 4/1/96 6/1/96 1/1/97 Account Balance (before deposit or withdrawal) 10,000 10.040 12,500 11.,400 13,500 2,000 2,000 Deposit Withdrawal 1,500 Calculate the annual effective yield rate by the time-weighted method. Calculate the annual effective yield rate by the dollar-weighted method