QUESTION 15

Part A: You want to quit your job and return to school for an MBA degree 3 years from now, and you plan to save $5,000 per year, beginning immediately. You will make 3 deposits in an account that pays 5.2% interest. Under these assumptions, how much will you have 3 years from today?

a. $16,614.78

b. $17,943.97

c. $17,445.52

d. $18,442.41

e. $14,953.30

Part B: What is the PV of an annuity due with 5 payments of $7,900 at an interest rate of 5.5%?

a. $41,285.20

b. $40,573.38

c. 35,590.69

d. $43,776.54

e. $41,997.01