a. Find the FV of $1,000 invested to eam 10% after 4 years. Round your answer to the nearest cent $ b. What is the investment's PV at rates of 0%, 6%, and 25% after 0, 1, 2, 3, 4, and 5 years? Round your answers to the nearest cent Interest Rate 6% Year 0% 25% O $ $ $ 1 $ $ $ 2 $ 5 $ 3 $ $ $ 4 $ $ $ 5 5 S $ Choose the correct graph of future value as a function of time and rate. Note: blue line is for 0%, orange line is for 6%, and grey line is for 25%. The correct graph is 7000 FVs Function of Time and Rate 6000 5000 4000 Future Value (5) . 3000 -2000 1000 Year 7000 Fas Function of Time and Rate 6000 5000 (s) 4000 B 3000 2000 10000 7000 FVS Function of Time and Rate 6000 5000 4000 Future Value (5) C. 3000 -2000 1000 Year 7000 FV as Function of Time and Rate 6000 5000 4000 Future Value (5) D 3000 2000 1000 Year c. Find the PV of $1,000 due in 4 years if the discount rate is 10. Round your answer to the nearest cent. $ d. A security has a cost of $1,000 and will return $4,000 after 4 years. What rate of return does the security provide Round your answer to two decimal places 6 Suppose California's population is 35.1 million people, and its population is expected to grow by 3% annually. How long will it take for the population to double round your answer to the nearest whole number Find the PV of an ordinaryonnuity that pays $1,000 each of the next 4 years if the interest rate is 10%. Then find the For that same annuity. Rouh your answers to the nearest cent PV of ordinary annuity PV of ordinary annuity! 0. How will the P and IV of the annuity in parte change it is an annuity due rather than an ordinary annuity Round your answers to the nearest cont. PV of annuity du: V of annuity du: h. What will the and the PV for parts and cbe if the interest rate is 10% with semiannual compounding rather than 10% with annual compounding? Round your answers to the nearest cent FV with semiannual compoundings V with semiannual compoundings 1. Find the annual payments for an ordinary annuity and an annuity due for 8 years with a PV or $1,000 and an interest rate of 9%. Round your answers to the nearest cent Annual payment for ordinary annuity: $ Annual payment for annuity due! 5 J. Find the PV and the FV of an investment that makes the following end-of-year payments. The interest rate is 9% Year 1 Payment $100 $200 $400 2 3 Round your answers to the nearest cent. py of investment: $ FV of investment: k. Five banks offer nominal rates of 7% on deposits, but A pays interest annually, B pays semiannually, Cpays quarterly, D pays monthly, and E pays dally. Assume 365 days in a year. 1. What effective annual rate does each bank pay? If you deposit $5,000 in each bank today, how much will you have in each bank at the end of 1 year? 2 years? Round your answers to two decimal places. A B C D E EAR % 9% % FV after 1 year 5 S $ $ 5 FV after 2 years $ $ $ $ $ 2. If the TV is the only consideration, what nominal rate will cause all of the banks to provide the same effective annual rate as Bank A7 Round your answers to two decimal place D Nominal rate 3. Suppose you don't have the $6,000 but need it at the end of 1 year. You plan to make a series of deposits - annually for A, semiannually for B, quarterly for monthly for D, and daily for t - with payments beginning today. How large must the payments be to each bank? Round your answers to the nearest cent. D Payment Even the five banks provided the same effective annual rate, would a rational investor be indifferent between the banks? Is more that an investor would prefer the bank that compounded frequently Suppose you borrow $15,000. The interest rate is ow, and it requires 4 equal end-of-year payments. Set up an amortization schedule that shows the al payments, interest payments, principal repayments, and beginning and ending loan balances. Round your answers to the nearest cent. If your weiser, entero Beginning Repayment Ending Payment Interest of Principal Year nalance Balance 1 Choose the correct graph that shows how the payments are divided between Interest and principal repayment over time. The correct graph is e 6000 Breakdown of payments Breakdown of payments 6000 5000 5000 4000 4000+ Dollar Values 3000 Dollar Values 3000 2000 2000 1000 1000 2 3 Year Year tincipe (1) oyment of inal) Interest (8) 6000 Breakdown of payments 6000 Breakdown of payments 5000 5000 4000 4000 Dollar Values 3000 Dollar Values 3000 C D. 2000 2000 1000 1000 Year Year Reyment of Principal (5) Interest () Repayment of Pic (5) Interest ($)