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Can someone help me to solve these problems(4 Questions)? 1. You need a brand new Macbook Pro. The apple store sales person is your cousin,
Can someone help me to solve these problems(4 Questions)?
1. You need a brand new Macbook Pro. The apple store sales person is your cousin, and he allows you to take the computer now and pay the money two years from now. The payment is 3000 dollars. In order to pay for this computer, you deposit some money in the bank now and will withdraw it two years later. The bank person is your uncle, and he offers you a nice and fat 8% interest rate (well above the market). How much money you need to deposit now to be able to pay for the computer? 2. So you decide to take advantage ofyour uncle's bank. You know 8% interest rate is much higher than the market. You take all your piggy bank money and save it in your uncle's bank. You cut the deal with your uncle that you will deposit 10,000 dollars now and take them out 25 years later for your first kid's college tuition. How much you would be able to pay when you take out all the money from your uncle's bank 25 years later? 3. You are offered the following asset: 2000 dollars payment each year, and you can hold it for only 10 years. At the end of the 10th year, right after you get your payment you need to donate it. Then how much is this asset worth now? 4. Now instead of donating this asset, your friend, Ross, is willing to pay 10,000 dollars for this asset at the end of 10th year. You agreed to do this trade with Ross. Then how much is this asset worth nowStep by Step Solution
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