What will a deposit of $5,000 left in the bank be worth under the following conditions?

Left for 5 years at 6% interest?

Left for 5 years at 6% interest compounded monthly?

Left for 5 years at 6% interest compounded continuously?

Left for 10 years at 6% interest?

Left for 10 years at 8% interest?

Your firm has a $10,000 note receivable due from a customer. How much is the note worth today if:

The note is due in 2 years and the discount rate is 8%?

The note is due in 3 years and the discount rate is 15%?

The note is due in 3 years and the discount rate is 10% compounded monthly?

How much will the following people have for retirement?

Alex deposits $100 a month for 20 years with a 6% return.

Beth deposits $100 a month for 30 years with a 6% return.

Chris deposits $100 a month for 30 years with a 9% return.

A lottery prize advertised as "$1 million" is actually paid as $25,000 a year for 40 years.

Find the present value of the $25,000 a year for 40 years using a 5% discount rate.

Find the present value using an 8% discount rate.

The winner of this lottery is offered $500,000 now instead of the series of payments that total $1 million. If this person believes that they can earn 5% interest, which option should they pick? Explain.

Find the monthly payments for a $15,000 car loan with the following terms. Also find the total amount that will be paid over the life of the loan.

4 year loan at 8% interest (compounded monthly)

Total paid

6 year loan at 12% interest (compounded monthly)

Total paid

Find the amount that must be saved each year to reach the following goals.

Darby needs $20,000 in 10 years and can receive 4% interest.

Fran needs $800,000 in 35 years and can receive 8% interest.

George has $20,000 in credit card debt at 18% interest compounded monthly. How many months will it take to pay off this amount:

If he makes a $350 payment each month?

If he makes a $520 payment each month?

What is the interest rate on loans with the following terms?

On $10,000 borrowed, pay $2,000 a year for 6 years.

On $2,000 borrowed, pay $100 a month for 25 months.

Answer these questions:

Jack deposits $3,000 a year at 4% interest. In how many years will he have $50,000?

How many years would it take $100 to become $1,000 at 15% interest?

You have paid $1,000 for an investment that will pay back $1,200 in 3 years. What interest rate does that represent?

A preferred stock is expected to pay an $8 annual dividend every year forever. If comparable market interest rates are 9%,

what is the value of this stock?

Answer these additional questions:

Amy's parents deposited $10,000 in a savings account earning 3% interest compounded monthly when she was born.

How much will the account have when Amy is 21 years old?

Beth is to receive $5,000 in 10 years. If Beth could be earning an 11% return on this money, what is it's present value?

Cameron has been depositing $50 a month into a 6% account for the last 5 years. How much is in his account?

Dave has recently retired, and is being paid an annuity of $24,000 a year for the rest of his life.

Statistically, he expects to live for 18 years. Using a 7% discount rate, find the present value of the annuity.