Question
Calculate the future value of anannuity, with case A being an ordinary annuity and case B being an annuity due. Case AnnuityInterest Rate (%)Deposit Period
Calculate the future value of anannuity, with case A being an ordinary annuity and case B being an annuity due.
Case AnnuityInterest Rate (%)Deposit Period (Yrs)Future Value ($)
A 18,000 3% 8
B 3,000 9% 12
2-For each of the followingcases, calculate the present value of theannuity, assuming the annuity cash flows occur at the end of each year.
Annuity Interest Rate (%) Period (Yrs) Present Value ($)
40,000 13% 6
22,000 7% 12
3-What is the future value of a 5year ordinary annuity with annual payments of$200, evaluated at a15% interestrate?
4-Tony plans to deposit$1,000 at the end of each of the next three years. If his funds earn5% compoundedannually, how much will he have at the end of threeyears?
5-Joe expects to start working immediately after graduation and he is already planning to retire. He wants to retire in twentyfive years and hopes that he will be able to do so comfortably by investing$2,000 at the end of each year throughout this period. If he earns5% compoundedannually, how much will be in his retirement fund in twentyfive years?
6-You just won the Sweepstakes and have decided to take your winning in 15 equal payments of$35,000. You decide to save all of this money for your retirement and deposit it into an account that earns11% per year. What is the amount of your retirement nestegg? (Round to the nearest wholedollar)
7-Jacquie plans to deposit$3,500 into her savings account for each of the next 5years, and then$2,000 per year for 5 years after that(all at yearend). She anticipates interest rates to be6% for the next 3 years and then9% thereafter. How much will she have in the account after the 10years?
8-You are 30 years old and you want to retire at age 60 with$1.5 million. You are going to make equal annual deposits into your savings account at the end of each year in order to save up this money. Your savings account pays8% interest. What amount must you deposit eachyear?
9-Margaret plans to deposit$500 on the first day of each of the next fiveyears, beginning today. If she earns4% compoundedannually, how much will she have at the end of fiveyears?
10-To pay for her collegeeducation, Gina is saving$2,000 at the beginning of each year for the next eight years in a bank account paying 12 percent interest. How much will Gina have in that account at the end of 8thyear? (Round up to the nearest whole dollaramount)
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