Use Future Value and Present Value Tables

1.Cathy Lumbattis inherited $140,000 from an aunt. If Cathy decides not to spend her inheritance but to leave the money in her saving account until she retires in 15 years, how much money will she have, assuming an annual interest rate of 8% compounded semiannually.

2. LuAnn Bean will receive $7,000 in 7 years. What is the present value at 7% compounded annually?

3. Ed Walker wants to save some money so that he can make a down payment of $3,000 on a car when he graduates from college in 4 years. If Ed opens a savings account and earns 3% on his money, compounded annually, how much will he have to invest now?

4. Kristen Quinn makes equal deposits of $500 semiannually for 4 years. What is the future value at 8%?

Chuck Russo, a high school math teacher, wants to set up an IRA account into which he will deposit $2,000 per year. He plans to teach for 20 more years and then retire. If the interest on his account is 7% compounded annually, how much will be in his account when he retires?

Larson Lumber makes annual deposits of $500 at 6% compounded annually for 3 years. What is the future value of these deposits?

Michelle McFeaters can earn 6%. How much would have to be deposited in a savings account in order for Michelle to be able to make equal annual withdrawals of $200 at the end of each of 10 years? The balance at the end of the last year would be zero.

Barb Muller wins the lottery. She wins $20,000 per year to be paid for 10 years. The state offers her the choice of a cash settlement now instead of the annual payments for 10 years. If the interest rate is 6%, what is the amount the state will offer for a settlement today?