Question

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 rate for the preferred stock is 7.57%. How much do you need to pay today to acquire this preferred stock? Please round your answer to the second decimal without dollar sign. E.g. 1.11

Answer #1

Please refer to below spreadsheet for calculation and answer. Cell reference also provided.

Cell reference -

Your parents want to place money in an account so that you can
withdraw $200 a week for the next four years while you finish
college and graduate school. If they place the money in an account
that earns 4% interest, compounded weekly, how much do they need to
place in the account so that the funds will be depleted in four
years? (Assume that you will make the first withdrawal one week
from today.)
Please elaborate on your reasoning...

1. Derek currently has $11,028.00 in an account that pays 6.00%.
He will withdraw $5,835.00 every other year beginning next year
until he has taken 7.00 withdrawals. He will deposit $11028.0 every
other year beginning two years from today until he has made 7.0
deposits. How much will be in the account 26.00 years from
today?
Answer format: Currency: Round to: 2
decimal places.
2. Derek can deposit $293.00 per month for the next 10 years
into an account at...

5-1
FUTURE VALUE If you deposit $10,000 in a bank
account that pays 10% interest annually, how much will be in your
account after 5 years?
5-2
PRESENT VALUE What is the present value of a
security that will pay $5,000 in 20 years if securities of equal
risk pay 7% annually?
5-3
FINDING THE REQUIRED INTEREST RATE Your parents
will retire in 18 years. They currently have $250,000, and they
think they will need $1,000,000 at retirement. What annual...

Q.1 You deposit $1,000 in your bank account. If the bank pays 4%
compounded interest, how much will you accumulate in your account
after 10 years? What if the bank pays interst on semi-annual
basis?
Q.2 If you earn 6% per year on your bank account, how long will
it take an account with $100 to double to $200?
Q.3 Your landscapping company can lease a truck for $8,000 a
year(paid at year-end) for six years. It can instead buy...

1. Your parents deposited $100 in a bank account for you when
you were born. For the first 16-years of your life, the interest
rate earned on the account was 6.5%. Since then, rates have fallen
considerably and have averaged just 3%. Now you are 30-years of age
and want to cash in to fund your property deposit. How much is in
your account?

Derek currently has $11,714.00 in an account that pays 5.00%. He
will withdraw $5,458.00 every other year beginning next year until
he has taken 4.00 withdrawals. He will deposit $11714.0 every other
year beginning two years from today until he has made 4.0 deposits.
How much will be in the account 22.00 years from today?
Answer format: Currency: Round to: 2
decimal places.
Derek can deposit $294.00 per month for the next 10 years into
an account at Bank A....

Suppose you deposit $20,000 into a saving account at your local
bank. If the bank pays an average interest rate of 5% annually, how
much money will you have in your saving account in 15 years?
Suppose, your bank talks you into opening a saving account with
them. The bank promises that if you put $10,000 in the saving
account today, you will receive $20,000 10 years from now. What is
the average interest rate that the bank will pay...

You Save Bank has a unique account. If you deposit $9,000 today,
the bank will pay you an annual interest rate of 3 percent for 6
years, 3.6 percent for 5 years, and 4.3 percent for 9 years. How
much will you have in your account in 20 years?
$17,632.03
$18,733.69
$15,830.19
$14,972.87
$16,255.00

Starting one month from now, you need to withdraw
$230230
per month from your bank account to help cover the costs of your
university education. You will continue the monthly withdrawals for
the next four years. If the account pays
0.40.4%
interest per month, how much money must you have in your bank
account today to support your future needs?
How much money must you have in your bank account today to
support your future needs?
$nothing
(Round to the...

When you were born your parents set up a bank account in your
name with an initial investment of $5,900. You are turning 21 in a
few days and will have access to all your funds. The account was
earning 7.3 percent for the first seven years, but then the rates
went down to 5.5 percent for six years. Your account then earned
8.2 percent three years in a row. Unfortunately, the next two years
you earned only 4.6 percent....

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