Series of Compound Interest Techniques

The following are several situations involving compound interest.

Required:

Using the appropriate table, solve each of the following:

1. Hope Dearborn invests $40,000 on January 1, 2019, in a savings account that earns interest of 8% compounded semiannually. What will be the amount in the fund on December 31, 2024?

   Round your answer to two decimal places.

   $ fill in the blank 1

2. Ben Johnson receives a bonus of $5,000 each year on December 31. Beginning on December 31, 2019, he deposits his bonus every year in a savings account that earns interest of 12% compounded annually. What will be the amount in the fund on December 31, 2023, after he deposits his bonus received on that date?

   Round your answer to two decimal places.

   $ fill in the blank 2

3. Ron Sewert owes $30,000 on a non-interest-bearing note due January 1, 2029. He offers to pay the amount on January 1, 2019, provided that it is discounted at 10% on a compound annual discount basis. What would he have to pay on January 1, 2019, under this assumption?

   Round your answer to two decimal places.

   $ fill in the blank 3

4. June Stickney purchased an annuity on January 1, 2019, which, at a 12% annual rate, would yield $6,000 each June 30 and December 31 for the next 6 years. What was the cost of the annuity to Stickney?

   Round your answer to two decimal places.

   $ fill in the blank 4

5. Five equal annual contributions are to be made to a fund, with the first deposit on December 31, 2019. Determine the equal contributions that, if invested at 10% compounded annually, will produce a fund of $30,000 on December 31, 2024.

   Round your answer to two decimal places.

   $ fill in the blank 5

6. Beginning on December 31, 2020, 6 equal annual withdrawals are to be made. Determine the equal annual withdrawals if $11,000 is invested at 10% interest compounded annually on December 31, 2019.

   Round your answer to two decimal places.

   $ fill in the blank 6