(Related to The Business of Life: Saving for Your First House) (Future value) You are hoping to buy a house the future and recently received an inheritance of $18,000. You intend to use your inheritance as a down payment your house. a. If you put your inheritance in an account that earns 8 percent interest compounded annually, how many years wi be before your inheritance grows to $34,000? b. If you let your money grow for 10.25 years at 8 percent, how much will you have? c. How long will it take your money to grow to $34,000 if you move it into an account that pays 4 percent compounded annually? How long will it take your money to grow to $34,000 if you move it into an account that pays 13 percent? d. What does all this tell you about the relationship among interest rates, time, and future sums? *** it be before your inheritance grows to $34,000? 8.26 years (Round to one decimal place.) b. If you let your money grow for 10.25 years at 8 percent, how much will you have? (Round to the nearest cent.)
(Related to The Business of Life: Saving for Your First House) (Future value) You are hoping to buy a house the future and recently received an inheritance of $18,000. You intend to use your inheritance as a down payment your house. a. If you put your inheritance in an account that earns 8 percent interest compounded annually, how many years wi be before your inheritance grows to $34,000? b. If you let your money grow for 10.25 years at 8 percent, how much will you have? c. How long will it take your money to grow to $34,000 if you move it into an account that pays 4 percent compounded annually? How long will it take your money to grow to $34,000 if you move it into an account that pays 13 percent? d. What does all this tell you about the relationship among interest rates, time, and future sums? *** it be before your inheritance grows to $34,000? 8.26 years (Round to one decimal place.) b. If you let your money grow for 10.25 years at 8 percent, how much will you have? (Round to the nearest cent.)
Cornerstones of Financial Accounting
4th Edition
ISBN:9781337690881
Author:Jay Rich, Jeff Jones
Publisher:Jay Rich, Jeff Jones
ChapterA3: Time Value Of Money
Section: Chapter Questions
Problem 7CE
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