Print 5. Assume you make the following investments: a. You invesi a lump surn of $7.550 for four years al 12% interest. What is the investment's value at the end of four years? b. In a different account earning 12% interest, you invest $1.888 at the end of each year for four years. What is the investment's value at the end of four years? c. What general rule of thumb explains the difference in the investments' future values? (Click the icon to view the future value factor table.) (Click the icon to view the future value annuity factor table.) Click the icon to view the present value factor table.) Click the icon to view the present value annuity factor table) a. You invest a lump sum of $7,550 for four years at 12% interest. What is the investment's value at the end of four years? (Round your answer to the nearest whole dolar.) Investment's value = b. In a different account earning 12% interest you invest $1,888 at the end of each year for four years. What is the investment's value at the end of four years? (Round your answer to the nearest whole dollar) Investment's value = c. What general rule of thumb explains the difference in the investments future values? earned interest only as the installments were The future value of the annuity is (1) - received over the course of four years. The (4) _ than the future value of the lurp sum investment. The (2) - earried interest over the full four years. However, the (3) the cash is investod, the (5) interest is earned. The investor lets time do the work. 1: Reference Periods 1% 1.010 1.020 1.030 5% 1.050 1.103 1.158 1.216 1.276 1.041 1.340 1.407 1.051 1.062 1.072 1.083 1.094 1.105 1.116 1.127 1.138 1.149 1.161 1 220 1.282 1.348 1.489 2% 1.020 1.040 | 1.081 1.082 1.104 1.126 1.149 1.172 1.195 1.219 1.243 1.288 | 1.294 1.319 1.316 1.486 1.641 1.811 2.208 3% 1.030 1.061 1.093 1.126 1.159 1.194 1.230 1.287 1.305 1.344 1.384 1.426 1.469 1.513 1.558 1.806 2.094 2.427 3.262 4% 1.040 1.082 1.125 1.170 1.217 1.265 1.316 1.369 1.423 1.480 1.539 1.601 1.665 1.732 1.801 2.191 2.666 3.243 4.801 1.477 1551 1.629 1.710 1.796 | 1.8B6 1.960 2.079 2653 3.388 4322 7.040 Future Value of $1 6% 8% 10% 1.060 1.080 1.100 1.124 1.166 1.210 1.191 1.280 | 1.331 1.262 | 1.360 1.464 1.338 1.469 1.611 1.419 1.587 1.772 1.504 1.714 1.949 1.594 1.851 2.144 1.689 1.999 2.358 1.791 2.159 2.594 1.898 2.332 2.853 2.012 2.518 3.138 2.133 2.720 3.452 2.261 2.937 3.797 2.397 3.172 | 4.177 3.207 4.661 6.727 4.292 6.818 10.835 5.743 10.063 17.449 10.238 21.725 45.259 12% 1.120 1.254 1.405 1.574 1.762 1.974 2211 2.476 2.773 3.106 3.479 3.479 3.896 4.363 4.887 5.474 9.646 17.000 29.960 93.051 14% 1.140 1.300 1.482 1.689 1.925 2.195 2.502 2.853 3.252 3.707 4.226 4.818 5.492 6.261 7.138 13.743 26.462 50.950 108.884 18% 18% 20% 1.100 1.100 1.200 1.346 1.392 1.440 1.561 1.843 1.728 1.811 1.939 2.074 2.100 2.288 2.468 2.436 2.700 2.986 2.8263.185 3.583 3.278 3.759 4.300 3.803 4435 5.160 4.411 5.234 6.192 5.117 6.176 7.430 5.9367.288 8.918 6.8868.599 10.699 | 7.988 10.147 12.839 9.266 11.974 15.407 19.461 27.393 38.338 40.874 82.669 95.396 85.850 143.371 237.376 378.721 750.378 1,469.772 2. Reference Print Periods Future Value of Annuity of $1 1% 2% 3% 4% 5% 6% 8% 10% 12% 14% 16% 18% 20% 1.000 1.000 1.000 1.000 1.000 1.000 1.000 1.000 1.000 1.000 1.000 1.000 1.000 2010 2.020 2.030 2.040 2.050 2.060 2.080 2.100 2.120 2.140 2.160 2.180 2.200 3.030 3.060 3.091 3.122 3.153 3.184 3.246 3.310 3.374 3.440 3.5063.572 3.640 4.060 4.122 4.184 4.248 4.310 4.375 4.508 4.641 4.779 4.921 5.066 5.215 5.368 5.101 5.204 5.309 5.416 5.5265.637 5.867 6.105 6.353 6.610 6.877 7.154 7.442 6.152 6.308 6.468 6.633 6.802 6.975 7.336 7.716 8.115 8.536 8.977 9.442 9.930 7.214 7.434 7.6627.898 8.142 8.394 8.923 9.487 10.089 10.730 11.414 12.142 12.916 8.286 8.583 8.892 | 9.2149.549 9.897 10.637 11.438 12.300 13.233 14.240 15.327 16.499 9.369 9.755 10.159 10.583 11.027 11.491 12.488 13.579 14.776 16.085 17.519 19.086 20.799 10.462 10.950 11.464 12.006 12.578 13.181 14.487 15.937 17.549 19.337 21.321 23.521 25.959 12.80813 486 14 207 14.972 16.645 18.531 20.655 23.045 25.733 28.755 32.150 12.683 13.412 14.192 15.026 15.917 16.870 18.977 21.384 24.133 27.271 30.850 31.931 39.581 13.809 14.680 15.618 16.627 17.713 18.882 21.495 24.523 28.029 32.089 36.786 42219 48.497 14.94715.974 17.088 18.292 19.599 21.015 24.215 27.975 32.393 37.581 43.872 50.818 59.198 16.09717.29318.599 20.024 21.579 23.276 27.152 31.772 37.280 43.842 51.660 60.965 72.035 22.019 24.297 26.370 29.778 33.088 38.786 45.762 57.275 72.052 91.025 115.380 148.628 188.688 28.243 32.030 36.459 41.646 47.727 54.865 73.106 98.347 133.334 181.871 249.214 342.603 471.981 34.785 40.568 47.575 58.085 66.439 79.058 113.283 164.494 241.333 358.787 530.312 790.948 1.181.882 48.886 60.402 75.401 95.026 120.800 154.762 259.57 442.593 767.091 1,342.025 2.360.757 4,163.2137.343.858 3: Reference Present Value of Annuity of $1 Periods 1% 2% 3% 4% 5% 6% 8% 10% 12% 14% 16% 18% 20% 1 0.990 0.980 0,971 0.962 0.952 0.943 0.926 0.909 0.893 0.877 0,862 0.847 0.833 1.970 1.942 1.913 1.888 1.859 1.833 1.783 1.736 1.690 1.847 1.605 1.588 1.528 2.941 2.884 2.829 2.775 2.723 2.673 2.577 2.487 2.402 2.322 2.246 2.174 2.106 4 3.902 3.808 3.717 3.630 3.546 3.465 3.312 3.170 3.037 2.914 2.798 2.690 2.589 4.853 4.713 4.580 4.452 4.329 4.2123.993 3.791 3.605 3.433 3.274 3.127 2.991 5.795 5.601 5.417 5.242 5.070 4.917 4.623 4.355 4.111 3.889 3.685 3.498 3.326 6.728 6.472 6.230 6.002 5.786 5.5825.206 4.868 4.564 4.288 4.039 3.812 3.605 7.652 7.325 7.020 6.733 6.463 6.210 5.747 5.335 4.968 4.639 4.344 4.078 3.837 8.566 8. 162 7.786 7.435 7.108 6.8026.247 5.759 5.328 4.946 4.607 4.303 4.031 10 9.471 8.963 6.530 8.111 7.722 7.360 6.710 6.145 5.650 5.216 4.833 4.494 4.192 11 10.368 9.787 9.253 8.760 8.306 7.887 7.139 6.495 5.938 5.453 5.029 4.656 4.327 12 11.255 10.575 9.954 9.385 8.8638.384 7.536 6.8146.194 5.660 5.197 4.793 4.439 13 12.131 11.348 10.635 9.996 9.394 8.853 7.901 7.103 6.424 5.842 5.342 4.910 4.533 13.004 12.106 11.296 10.563 9.899 9.295 8.24473676.628 6.0025.468 5008 4.611 15 13.865 12.849 11.908 11.118 10.300 9.7128.559 | 7.606 6.811 6.142 5.575 5.0924.675 201804616,351 14.877|13.590 12.462 11.470 9.818 8.5147.469 6.623 5.929 5.353 4.870 25 22.023 19.523 17.41315.622 14.091 12.783 10.675 9.077 7.843 6.673 6.097 5.467 4.948 25 808 22.396 19.600 17.292 15.372 13.765 11 2589.4278.055 7.003 6.177 5517 4.979 32.835 27.356 23.115 19.793 17.159 15.046 11.925 9.7798.244 7.105 6.233 5.548 4.997 54983010/6 4: Reference Present Value of Annuity of $1 Periods 1% 2% 3% 4% 5% 6% 8% 10% 12% 14% 16% 18% 20% 1 0.990 0.980 0.971 0.962 0.952 0.943 0.926 0.909 0.893 0.877 0.862 0.847 0.833 2 1.970 1.942 1.913 1.886 1.859 1.833 1.783 1.736 1.690 1.647 1.605 1.566 1.528 2.941 2.884 2.829 2.775 2.723 2.673 2.577 2.487 2.402 2.322 2.246 2.174 2.106 3.902 3.808 3.717 3.630 3.546 3.465 3.312 3.170 3.037 2.914 2.798 2.690 2.589 4.853 4.713 4.580 4.452 4.329 4.212 3.993 3.791 3.605 3.433 3.274 3.127 2.991 5.795 5.601 5.417 5.242 5.076 4.917 4.623 4.355 4.111 3.889 3.685 3.498 3.326 6.728 6.472 6.230 6.002 5.786 5.582 5.206 4.868 4.564 4.288 4.039 3.812 3.605 7.652 7.325 7.020 6.733 6.463 6.210 5.747 5.335 4.968 4.639 4.344 4.078 3.837 8.566 8.162 7.786 7.435 7.108 6.802 6.247 5.759 5.328 4.946 4.607 4.303 4.031 10 9.471 8.983 8.530 8.111 7.722 7.360 6.710 6.145 5.650 5.216 4.833 4.494 4.192 11 10.368 9.787 9.253 8.760 8.306 7.887 7.139 6.495 5.938 5.453 5.029 4.656 4.327 11.255 10.575 9.954 9.385 8.863 8.384 7.536 6.814 6.194 5.660 5.197 4.793 4.439 12.134 11.348 10.635 9.986 9.394 8.853 7.904 7.103 6.424 5.842 5.342 4.910 4.533 13.004 12.106 11.296 10.563 9.899 9.295 8.244 7.367 6.628 6.002 5.468 5.008 4.611 15 13.865 12.849 11.938 11.118 10.380 9.712 8.559 7.606 6.811 6.142 5.575 5.092 4.675 20 18.046 16.351 14.877 13.590 12.462 11.470 9.818 8.514 7.469 6.623 5.929 5.353 4.870 25 22.023 19.52317.413 15.622 14.094 12.783 10.675 9.077 7.8436.8736.097 5.467 4.948 25.808 22.396 19.600 17.292 15.372 13.765 11.258 9.427 8.055 7.003 6.177 5.517 4.979 40 32.835 27.355 23.115 19.793 17.159 15.046 11.925 9.779 8.244 7.105 6.233 5.548 4.997 j o o voo AwN- (5) O (1) O higher O lower (2) O annuity O lump-sum investment (3) O annuity O lump-sum investment (4) O O later sooner less more