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number 2 and/ or 3 pls Problem set 3: Annuity and Perpetuity Member Names of your study group Time spent on this problem set: FPV
number 2 and/ or 3 pls
Problem set 3: Annuity and Perpetuity Member Names of your study group Time spent on this problem set: FPV (+Y PF - TVP PV/ (V/1 InfV/ py-C/ 1. You won the lottery. The money is paid in equal annual installments of $100,000 over 25 years beginning today If the appropriate discount rate is 6%, how much is the sweepstakes actually worth today? 2. You have accumulated $1000 in credit card debt. Your interest rate is 15% per month and you will pay it off in a. What is your monthly payment? 55 months b. How much interest will you end up paying? Now assume that you will pay an extra $10 per month on top of your regular monthly payments so that you will pay it off in only 35 months. How much interest will you save? 3. You are offered the opportunity to put some money away for retirement. You will receive five annual payments of $25,000 each beginning in 40 years. How much would you be willing to invest today if you desire an interest rate of 12 Step by Step Solution
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