Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Provided are links to the present and future value tables; (PV of $1. FV of $1, PVA of $1, and FVA of $1) (Use appropriate

image text in transcribed
Provided are links to the present and future value tables; (PV of \$1. FV of \$1, PVA of \$1, and FVA of \$1) (Use appropriate factor(5) from the tables provided. Round your answer to the nearest whole dollar.) a. How much would you have to deposit today if you wanted to have $45,000 in five years? Annual interest rate is 8% b. Assume that you are saving up for a trip around the world when you graduate in two years. If you can earn 7% on your investments, how much would you have to deposit today to have $11,500 when you graduate? (Round your answer to 2 decimal places.) c-1. Calculate the future value of an investment or $535 for nine years earning an interest of 12% (Round your answer to 2 decimal places.) c.2. Would you rather have $535 now or $1,000 nine years from now? d. Assume that a college parking sticker today costs $66. if the cost of parking is increasing at the rate of 4% per year, how much will the college parking sticker cost in nine years? (Round your answer to 2 decimal places.) e. Assume that the average price of a new home is $113,000. If the cost of a new home is increasing at a rate of 9% per year, how much will a new home cost in nine years? (Round your answer to 2 decimal places.) f. An investment will pay you $6,500 in 10 years, and it also will pay you $230 at the end of each of the next 10 years (years 1 through 10) If the annual interest rate is 6%, how much would you be willing to pay today for this type of irvestment? (Round your intermediate calculations and final answer to the nearest whole dollar.) 9. A college student is reported in the newspaper as having won $7,000,000 in the Kansas State Lottery. However, as is often the custom with lottenies, she does not actuolly receive the entire $7 milion now instead she will recerve $350.000 at the end of the year for each of the next 20 years. If the annual interest rate is 5%, What is the present value (today's amount) that she won? (ignore taxes) (Round your answer to nearest whole dollar.)

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

Financial Accounting And Reporting A Global Perspective

Authors: Herve Stolowy, Yuan Ding, Luc Paugam

6th Edition

147376730X, 9781473767300

More Books

Students also viewed these Accounting questions