Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

for part(a), you can suppose there will be n payments in the future. Question 2 (6 marks) Suppose you are to deposit funds into a

image text in transcribedimage text in transcribedfor part(a), you can suppose there will be n payments in the future.

Question 2 (6 marks) Suppose you are to deposit funds into a savings account at a continuous rate of payment of $100 per year, in perpetuity. The payments will commence in 6 months. Assuming i = 5.5%, calculate each of the following (show all working). (a) The present value now, of all future deposits made. Give your answer to the nearest cent. [2 marks] (b) The present value in exactly 5 years time, of all future payments made from time 6 onwards. Give your answer to the nearest cent. [1 mark] (c) The present value in exactly 100 years time, of all future payments made from time 100 onwards. Give your answer to the nearest cent. [1 mark] as the (d) The accumulated value in the savings account in exactly 30 years time from now. Give your answer to the nearest cent. [2 marks] value in teaving count in curty 30 years is from now

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Quantitative Analysis For Management

Authors: Barry Render, Ralph M. Stair, Michael E. Hanna, Trevor S. Hale

14th Edition

0137943601, 9780137943609

More Books

Students also viewed these Finance questions