AGEC 217 Dr. Menzies Homework #3 Hannah Jones Show work for any partial credit. 1) What is the future value of $25,000 invested today at 8% compounded monthly for 4 years? FV=PV*(1+i)" = 2900 D (1.0047) "2.4 14X12 FV = 25000 (17.08.)***2 = 1439 1.65 30 2) What is the present value of $400,000 you save for retirement 30 years from now if you discount it at 5%? FV=PV/14 jn PV = 400 DO DO (17.05) PV=92950.98 3) What is the monthly payment on a new house that you borrow $250,000 for and pay 4% interest? 400.000 = PV (17.05) 4) How long will it take your money to triple if you receive 10% return on your money, compounded annually? 5) If your money doubled in 7 years, what was the interest rate you received if compounded annually? 6) If you had two investment opportunities, A-8% compounded annually or B-8.25% simple interest, which would you choose over a ten-year horizon