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PART 1: Your bank offers an interest rate of 4% per year. How many years does it take to double your money? PART 2: You
PART 1:
Your bank offers an interest rate of 4% per year.
How many years does it take to double your money?
PART 2:
You have $4,000 in your savings account, and want to buy a car for $25,000.
If you want to buy the car in 7 years, what interest rate would you need to earn?
PART 3:
You expect to receive two cash flows: $34,000 paid in 5 years and $51,000 paid in 10 years. You'll put the money into a savings account with an annual interest rate of 9%.
What is the future value of the combined cash flows, in 15 years?
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