1. You deposited $1000 into a savings plan at the end of each year for 3 years. The rathe is 8% per year compounded annually. a. Find the value of the annuity after 3 years. b. Find the interest.
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- Use the tables in Appendix B to answer the following questions. A. If you would like to accumulate $2,500 over the next 4 years when the interest rate is 15%, how much do you need to deposit in the account? B. If you place $6,200 in a savings account, how much will you have at the end of 7 years with a 12% interest rate? C. You invest $8,000 per year for 10 years at 12% interest, how much will you have at the end of 10 years? D. You win the lottery and can either receive $750,000 as a lump sum or $50,000 per year for 20 years. Assuming you can earn 8% interest, which do you recommend and why?You want to invest $8,000 at an annual Interest rate of 8% that compounds annually for 12 years. Which table will help you determine the value of your account at the end of 12 years? A. future value of one dollar ($1) B. present value of one dollar ($1) C. future value of an ordinary annuity D. present value of an ordinary annuityUse the tables in Appendix B to answer the following questions. A. If you would like to accumulate $4,200 over the next 6 years when the interest rate is 8%, how much do you need to deposit in the account? B. If you place $8,700 in a savings account, how much will you have at the end of 12 years with an interest rate of 8%? C. You invest $2,000 per year, at the end of the year, for 20 years at 10% interest. How much will you have at the end of 20 years? D. You win the lottery and can either receive $500,000 as a lump sum or $60,000 per year for 20 years. Assuming you can earn 3% interest, which do you recommend and why?
- Assume that you deposit RM700 in a savings account that pays 5% per year over 6 years. Your savings benefits from _____ as you leave the interest earnings in your account, and your interest earnings increases every year. Select one: a. compounding b. accumulating c. discounting d. aggregatingIf you deposit $100 in a savings account at the end of each month for 2 years, the balance will be a function f (r) of the interest rate, r%. At 7% interest (compounded monthly), f (7) = 2568.10 and f (7) = 25.06. Approximately how much additional money would you earn if the bank paid 7 1/2 % interest?You have decided to put $ 200 in a savings account on the first of every half-year for 10 years. The savings account credits interest semi-annually, at the annual rate of 6% . You wish to know how much money will you have in your account immediately after your last deposit. Find the number of payments per year. a. 1 b. 4 c. 12 d. 6 e. 2
- Which investment will give you the higher future value in 5 years? Investment 1: You deposit $100 every month into an investment savings account that has an interest rate of 2.5% compounded daily. Investment 2: You deposit $300 every three months into an investment savings account that has an interest rate of 2.6% compounded semi-annually.Find the NPV and PI of an annuity that pays $500 per year for eight years and costs $2,500. Assume a discount rate of 6%. Show the calculations.4. You want to deposit $600 in a savings account. Account A earns 3.5% simple interest per year. Account B earns 3.3% interest compounded annually. a. Which account should you choose if you invest your money for 3 years? 6 years? Explain. b. After how many years is the balance in Account B greater than the balance in Account A? c. After how many years is the difference between the account balances greater than $5?
- Classify the financial problem. Assume a 9% interest rate compounded annually. Deposit $200 at the end of each year. What is the total in the account in 10 years? A. sinking fundB.present value C.amortizationD. ordinary annuityE. future value Answer the question. (Round your answer to the nearest cent.)3. Use the annuity formula to calculate the future value of an annuity where you deposit $50 into an account gaining 5% interest for 3 years. Assume monthly deposits. Write out the formula first to show your work.You open a savings account with $1,000. At the end of each year you earn 3% interest on your savings and then you deposit $1,000 into the account. Let An be the amount in the account after n years. 1. Explain why A₁ = 2,030. 2. Calculate A2 and A3. Round to the nearest penny if necessary. 3. Write a recurrence relation for An+1 in terms of An. What is the first term A₁?
