Wednesday 3 October 2012

Suppose you have a thousand dollar investment for 4 years at 7%, but it's compounded quarterly

Homework #3

1. Suppose you have a thousand dollar investment for 4 years at 7%, but it's compounded quarterly
What is the future value of that investment?

2. You are 19 years old, and when you reach 25, you want to have 100 grand in the bank.  You can take on
a risky annual rate of 11%.  How much would you need to deposit to make it happen?

3. What interest rate would you be earning to double your money in one year, assuming you are compounding monthly?

4.  You have 10k dollars, and want to turn it to twenty K.  At 7%, how long do you have to wait?

5. As per #4, wht if you needed it to be 30K instead of 20K?

6. Find the PV of 8000 due in 4 years, assuming the rate is 5%

7. If a potential investment had a cost of 1000, but returned 2000 only 5 years later, what would be the return?

8.  If the population of Idaho is 1.4 million, and the growth rate is 2% per year, how long will it take for the population to double?

9. Find the PV of an annuity that pays 1000 at the end of the next 5 years if the interest rate is 15%

10. What is your car payment if you borrow $22,000 at 6% interest, assuming monthly payments for 5 years that start today?



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