Question

You have $10 000 to invest. If you invest it at 11.2% p.a. for six months,...

You have $10 000 to invest. If you invest it at 11.2% p.a. for six months, compounding annually then continue to invest the principal amount together with any interest for a further 12 months at 12.7% p.a., compounding annually, what will be the value of your investment at the end of the 18-month period?

Business   Finance   
0 0
Add a commentTranscribed image text
Next >

Homework Answers

Answer #1

hence answer = $ 11901.12

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
1.Suppose you will receive $14,000 in 10 months and another $8,000 in 22 months. If the...
1.Suppose you will receive $14,000 in 10 months and another $8,000 in 22 months. If the discount rate is 5% per annum (compounding monthly) for the first 13 months, and 10% per annum (compounding monthly) for the next 9 months, what single amount received today would be equal to the two proposed payments? (answer to the nearest whole dollar; don’t include the $ sign or commas) 2. Jill wants to buy a car but needs to calculate how much she...
We take a​ 10-year mortgage for ​$100 comma 000 at 7.25​% p.a. It is to be...
We take a​ 10-year mortgage for ​$100 comma 000 at 7.25​% p.a. It is to be repaid in monthly repayments. ​(a)What is the repayment​ amount? Assume that interest is compounded monthly. Which formula should you use to solve this​ problem? ​(b) What is the balance outstanding after two​ years? How much principal and how much interest have been​ paid? ​(c) After two​ years, the interest rate falls to 6.75​% p.a. What prepayment penalty would make it unattractive to prepay the​...
Suppose the current annualized spot rates are as follows: 6 months 2% 12 months 4% 18...
Suppose the current annualized spot rates are as follows: 6 months 2% 12 months 4% 18 months 6% Assume semi-annual compounding and semi-annual coupon payment. An investor has an investment horizon of six months. She can invest her money in three ways. First, buy a 6-month zero-coupon bond with a par of $1000 and hold it until maturity. Second, buy a 12-month zero-coupon bond with a par of $1000 and sell it 6 months later. Third, buy a 18- month...
Mark is trying to decide how to invest $10 000 for a minimum 5 year period.  ...
Mark is trying to decide how to invest $10 000 for a minimum 5 year period.   He is choosing between a safe low yield investment and a risky high yield investment. Investment A has a 70% chance of making 20% on his original investment over the next 5 years(so, it has a chance of being worth $12 000 at the end of the 5 year period), 25% of making 10% and 5% of making 5% on his money. Investment B...
19. I have an opportunity to invest $20,000 today at a compound interest rate of 6.4%...
19. I have an opportunity to invest $20,000 today at a compound interest rate of 6.4% p.a compounded monthly. I intend to withdraw the total account balance when it reaches $106,000. How long do I need to hold the investment? Answer in months to two decimal places.   20. Greg makes an investment which is expected to pay 4% p.a. interest, compounded annually. He invests $4,000 today. The value of the investment at the end of nine years, if you make...
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...
For 2 years, you deposit $45 per month in an account that earns 10% annually with...
For 2 years, you deposit $45 per month in an account that earns 10% annually with monthly compounding. After the first five months, you deposit a $500 lump sum. Six months after that (on month 11), you deposit $1000 into your account. Eight months later (on month 19), you make a $750 deposit. You then move your money to an account that has 3.5% monthly interest compounded weekly. You keep it in this account for 3 years. After this time...
Assuming you have that same $50,000, but you choose to invest it for 10 years in...
Assuming you have that same $50,000, but you choose to invest it for 10 years in an investment which earns 10% interest, but compounds annually. What is the Future Value of this investment? (When rounding in each step, when applicable please round to the nearest hundredth. i.e. two decimal places: 3.45.)
You have just arranged for an eight-year bank loan for $350,000 at an interest rate of...
You have just arranged for an eight-year bank loan for $350,000 at an interest rate of 12% p.a. with interest compounded semi-annually. The loan will be repaid in 16 equal semi-annual installments and the first payment will be due six months from today. Assuming end-of-theperiod cash flows, the interest paid in period 2 will be closest to: a) $13,633. b) $14,451. c) $20,182. d) $21,000.
You are a young personal financial adviser. Molly, one of your clients approached you for a...
You are a young personal financial adviser. Molly, one of your clients approached you for a consultation about her plan to save aside $450,000 for her child’s higher education in the United States 15 years from now. Molly has a saving of $120,000 and is considering different alternative options: Investment 1: Investing that $120,000 in savings account for 15 years. There are two banks for her choice. Bank A pays a rate of return of 8.5% annually, compounding semi-annually. Bank...
ADVERTISEMENT
Need Online Homework Help?

Get Answers For Free
Most questions answered within 1 hours.

Ask a Question
ADVERTISEMENT