Question

1.What is the present value of $14,000 ?received:

**a. 28** years from today when the interest rate
is 4% per? year?

**b.14** years from today when the interest rate is
4% per? year?

**c. 7** years from today when the interest rate is
4% per? year?

**a. 28** years from today when the interest rate
is 4% per? year?

2. Your cousin is currently 8 years old. She will be going to college in 10 years. Your aunt and uncle would like to have $120,000 in a savings account to fund her education at that time. If the account promises to pay a fixed interest rate of 4.2% per?year, how much money do they need to put into the account today to ensure that they will have $120,000 in 10 ?years?

Answer #1

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