Question

Sahara's parents decide to invest $500 on each of her birthday from the day she was...

Sahara's parents decide to invest $500 on each of her birthday from the day she was born until she became 25 years old. they have two options to choose

Option A: $500 invested annually that earns 6.4%/a simple interest for 25 years.

Option B: $500 invested annually that earns 6.4%/a compounded Semi-annually for 25years.

(i) Determine the total amount of investment for Option A and B when Sahara is 25 years old
(II) Which option should Sahara's parents choose? and explain

Math   Advanced-Math   
0 0
Add a commentTranscribed image text
Next >

Homework Answers

Answer #1

0 0
Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Log In

Sign Up

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
a) on your sister’s 10th birthday, your parents want to invest a certain amount to enable...
a) on your sister’s 10th birthday, your parents want to invest a certain amount to enable her to withdraw R25 000 every six months from her 18th to her 24th birthday (both birthdays included). Calculate the sum they will have to invest if compounded interest is estimated at 12% per annum, compounded biannually. b) What is the present value of a perpetuity that pays R4 800 per year if the first payment does not begin until four years later and...
Linda Roy received a $221,000 inheritance after taxes from her parents. She invested it at 5.5%...
Linda Roy received a $221,000 inheritance after taxes from her parents. She invested it at 5.5% interest compounded quarterly for 6 years. A year later, she sold one of her rental properties for $231,000 and invested that money at 4.5% compounded semiannually for 5 years. Both of the investments have matured. She is hoping to have at least $521,000 in 10 years compounded annually at 3.5% interest so she can move to Hawaii. Future Value of Inheritance Investment: $ Future...
Yumi's grandparents presented her with a gift of $17,000 when she was 10 years old to...
Yumi's grandparents presented her with a gift of $17,000 when she was 10 years old to be used for her college education. Over the next 7 years, until she turned 17, Yumi's parents had invested her money in a tax-free account that had yielded interest at the rate of 2.5%/year compounded monthly. Upon turning 17, Yumi now plans to withdraw her funds in equal annual installments over the next 4 years, starting at age 18. If the college fund is...
Yumi's grandparents presented her with a gift of $22,000 when she was 9 years old to...
Yumi's grandparents presented her with a gift of $22,000 when she was 9 years old to be used for her college education. Over the next 8 years, until she turned 17, Yumi's parents had invested her money in a tax-free account that had yielded interest at the rate of 4.5%/year compounded monthly. Upon turning 17, Yumi now plans to withdraw her funds in equal annual installments over the next 4 years, starting at age 18. If the college fund is...
PLEASE ANSWER ALL, I am unable to post individually. Dont not answer, and request to post...
PLEASE ANSWER ALL, I am unable to post individually. Dont not answer, and request to post the remaining separately. Thank you ! 2.Your aunt is planning to invest in a bank CD that will pay 7.0 percent interest semiannually. If she has $13,000 to invest, how much will she have at the end of four years? 3.Lisa Anderson received a graduation present of $1,000 that she is planning on investing in a mutual fund that earns 14.00 percent each year....
WEEK 4 FIN CORP (ASSNGMNET) SHOW YOUR CALCULATIONS FOR #7-#20. You have the option of performing...
WEEK 4 FIN CORP (ASSNGMNET) SHOW YOUR CALCULATIONS FOR #7-#20. You have the option of performing calculations manually BUT ARE STRONGLY ENCOURAGEDto use a financial calculator or spreadsheet. Either way, you must specify what is being calculated to earn credit: 1,If you are earning a salary of $42,000 in 2018 and expect to receive 4% raises per annum on January 1, what do you anticipate your salary will be in 2027? 2.What is the future value of $5,000 invested for...
1. John invested $20,000 fifteen years ago with an insurance company that has paid him 8...
1. John invested $20,000 fifteen years ago with an insurance company that has paid him 8 percent (APR), compounded quarterly (every 3 months). How much interest did John earn over the 15 years? a. $2,416.08 b. $45,620.62 c. $24,000.00 d. $28,318.95 e. $65,620.62 2. You are running short of cash and really need to pay your tuition. A friend suggests that you check out the local title pawn shop. At the shop they offer to loan you $5,000 if you...
  The following balance sheet and income statement should be used for questions #1 through #6: Kuipers,...
  The following balance sheet and income statement should be used for questions #1 through #6: Kuipers, Inc. 2001 Income Statement (OMR in millions) Net sales 9,625 Less: Cost of goods sold 5,225 Less: Depreciation 1,890 Earnings before interest and taxes 2,510 Less: Interest paid 850 Taxable income 1,660 Less: Taxes 581 Net income 1,079 Addition to retained earnings 679 Dividends paid 400 Kuipers, Inc. 12/31/00 and 12/31/01 Balance Sheet (in OMR, in millions) 2000 2001 2000 2001 Cash 1,455 260...
QUESTION 1 All of the followings are the rights and privileges of a Common Stockholders EXCEPTING:...
QUESTION 1 All of the followings are the rights and privileges of a Common Stockholders EXCEPTING: a. Voting/Proxy Rights b. Right to Dividends c. Residual Right d. Pre-emptive Right e. Right to Interest Payments 10 points    QUESTION 2 Your best friend's parents want to buy a home in the Worcester County, but they don’t know the exact amount of money that they can afford to borrow. They can afford monthly payments of $ 1,800. A friendly bank in Worcester...
Everyday investment company Sharesies was launched in February 2017, after conducting research on New Zealanders’ attitudes...
Everyday investment company Sharesies was launched in February 2017, after conducting research on New Zealanders’ attitudes towards investing. Prior to launching the company, the co-founders interviewed over 200 people asking them “If I gave you $50 right now, and you had to do something with it in the next 5 minutes what would you do?” Only 5 out of 200 people chose an option to save or invest the $50. More popular options were bills, online shopping, coffees, vouchers, food,...
ADVERTISEMENT
Need Online Homework Help?

Get Answers For Free
Most questions answered within 1 hours.

Ask a Question
ADVERTISEMENT