q1)

A. A person requires Rs 20,000 at the beginning of each year from 2025 to 2029. How much should he deposit at the end of each year from 2015 to 2020. The interest rate is 20 percent. -4

B. As a winner of a competition, you may choose one of the following prizes:

a. Rs 5, 00,000 now

b. Rs 1000000at the end of 6 years

c. Rs 60,000 a year forever

d.Rs100000 per year for 10 years

e. Rs 35,000 next year and rising thereafter by 5 percent per forever.

If the interest rate is 10 percent, which prize has the highest present value?

Q2.You are considering whether your savings will be enough to meet your retirement needs. You saved 1, 00,000 last year and you expect your annual savings to increase by 8 percent per year for next 20 years. If your savings can be invested at 9 percent, how much would you have at the end of the 20th years?

Q3. Raja deposits Rs. 10,000 in a bank today. The interest rate is 10 percent and compounding is done semi-annually. What will the deposit grow to after 10 years if, the inflation rate is 8 percent per year? What will be the value of the deposit after 10 years in terms of the current rupee

ANSWER ALL 3 SHORT QUESTIONS