Question

How much do you need to deposit today (P) to withdraw $25,000 at n =1, $3,000 at n = 2, and $5,000 at n =4, if your account earns 10%

a) Find annual interest

b) Find A

Answer #1

Answer : **a.) Annual Interest = 10%**

**b.)A = $ 28622**

**Calculation and Explanation**

To calculate annual Interest we need to first calculate A

**Amount deposited can be calculated by discounting
Payment using 10% as discount ratein various years(n)**

Amount Deposited 'A' = [ 25000 /(1.10)1 ] + [3000 / (1.10)2] + [ 5000 / (1.10)4]

= 22727.2727 + 2479.33884 + 3415.06728

**= 28621.68 or $ 28622**

**Therefore Annual Interest = 10%**

Number of year(n) | Beginning Balance | Interest Earned @10% |
Amount Deposited | Balance at the end |

0 | 0 | 0 | 28622 | 28622 |

1 | 28622 | 2862.20 | (25000) | 6484.20 |

2 | 6484.20 | 648.42 | (3000) | 4132.62 |

3 | 4132.62 | 413.262 | 4545.882 | |

4 | 4545.882 | 454.5882 | (5000) | 0 |

How much would you have to deposit today if you want to have
$1,000 in five years and the annual interest rate is 5%?
You plan to buy a house today for $220,000. If the real estate
in your area is expected to increase in value by 2% each year, what
will be the approximate value of your house in 7 years?
How much would you have to deposit today to be able to withdraw
$500 each year for the...

You want to be able to withdraw $25,000 each year for 20 years.
Your account earns 6% interest.
a) How much do you need in your account at the beginning?
$
b) How much total money will you pull out of the account?
$
c) How much of that money is interest?
$

You want to be able to withdraw $25,000 each year for 15 years.
Your account earns 9% interest.
a) How much do you need in your account at the beginning?
$
b) How much total money will you pull out of the account?
$
c) How much of that money is interest?

You want to be able to withdraw $25,000 from your account each
year for 25 years after you retire.
You expect to retire in 20 years.
If your account earns 9% interest, how much will you need to
deposit each year until retirement to achieve your retirement
goals?

1. You want to be able to withdraw $35,000 each year for 25
years. Your account earns 5% interest.
a) How much do you need in your account at the beginning?
b) How much total money will you pull out of the account?
c) How much of that money is interest?
2. You want to buy a $23,000 car. The company is offering a 2%
interest rate for 48 months (4 years). What will your monthly
payments be?
3. Suppose...

How much would you need to deposit in an account now in order to
have $4000 in the account in 10 years? Assume the account earns 2%
interest compounded monthly.

How much would Eli have to deposit today to be able to withdraw
$ 1,200 each year for life if Can you earn 10% annually compounded
annually on your deposit?

1, Your parents deposit $10,000 into your bank account and allow
you to withdraw $500 every month for living expenses in 2 years to
support your MBA education. What annual interest
rate does the bank pay so that you will withdraw
everything in 2 years? Please round your answer to the fourth
decimal. For example, if your answer is 1%, you should input
0.0100.
2, A preferred stock pays an annual dividend of $1.01 per share
forever. The appropriate interest...

A. Suppose you invest $83736 today in an account that earns 13%
interest annually. How much money will be in your account 7 years
from today?
B. What is the value today of single payment of $36665, 18 years
from today if the value is discounted at a rate of 19%?
C. How many years would it take an investment of $172 to grow to
$18096 at an annual rate of return of 15%?
D. How much money would you...

6. You deposit $400 each month into an account earning 5%
interest compounded monthly.
a) How much will you have in the account in 35 years?
b) How much total money will you put into the account?
c) How much total interest will you earn?
7. Suppose you want to have $500,000 for retirement in 25 years.
Your account earns 7% interest.
a) How much would you need to deposit in the account each
month?
b) How much interest will...

ADVERTISEMENT

Get Answers For Free

Most questions answered within 1 hours.

ADVERTISEMENT

asked 44 seconds ago

asked 19 minutes ago

asked 27 minutes ago

asked 28 minutes ago

asked 36 minutes ago

asked 37 minutes ago

asked 48 minutes ago

asked 1 hour ago

asked 1 hour ago

asked 1 hour ago

asked 1 hour ago

asked 1 hour ago