Go, Chinese Economy Essay

How much would you pay for a security that pays you $500 every 4 months for the next 10 years if you require a return of 8% per year compounded monthly?

Billy would still deposit $6 a week and about $24 a month. With the interest included, Billy would’ve saved about $2,020.49 in seven years, however this is risky because he could possibly lose a lot of money while investing in stocks.

Recently, CEO Roger Smith has passed away. Mr. Smith had much success in his lifetime. The CEO stated in his will that he wanted to give his money to his grandchildren. The company board has decided to split his earnings and give it to three of his grandchildren. Each grandchild will receive 5 million dollars. Mr. Smith had always been about helping those in need. The Board chose the three grandchildren that will make a difference with the inheritance. The three grandchildren who were chosen are Fred, Marsha, and Janet Smith.

B. The present value of an annuity is unaffected by the number of the annuity payments.

investor should invest $369.35 in asset A and the remaining $630.65 in asset B. The

d. If you can earn 9% per year, how much will you have to save each year if you want to retire in 40 years with $3 million?

What annual interest rate is needed to produce $200,000 after five years if only $100,000 is invested?

2. St. Luke’s Convalescent Center has $200,000 in surplus funds that it wishes to invest in marketable securities. If transaction costs to buy and sell the securities are $2,200 and the securities will be held for three months, what required annual yield must be earned before the investment makes economic sense?

1a. You get the same prize but the choice changes to $5,000 now or $5,250 in three years. What do you do?

4. Given that both Joe and Mary Garner are in their mid-30s and want to retire when they reach age 65, what type of investment goals would be most appropriate for them?

1. If Mrs. Beach wanted to invest a lump sum of money today to have $100,000 when she retired at 65 (she is 40 years old today) how much of a deposit would she have to make if the interest rate on the C.D. was 5%?

1. You are planning to retire in twenty years. You'll live ten years after retirement. You want to be able to draw out of your savings at the rate of $10,000 per year. How much would you have to pay in equal annual deposits until retirement to meet your objectives? Assume interest remains at 9%. [$1254]

In question four, Janet was asked to solve a question that deals with annuity payments, specifically, ordinary annuities. It starts by asking of how much you will make if you add $2,000 every year and it is compounded by 10% interest every year. These, for the most part, are future value problems. The first one comes out to be a future value of $12,210.20, which does not satisfy the need for $20,000. The next part asks what the value would be if the interest was compounded semiannually. You have to do an equation in order to find out what the effective annual interest rate. Through this equation you come out with a value of 10.25% and after the calculator calculations you come out with a future value of $12,271.11, also not meeting the demand for that first year of college. The next part asks what payment will you need in order to get to that $20,000 number and the present value comes to be $3,275.95. Next, the case asks what original payment you would need in order

B. The money that is collected is put in a trust fund that provides a monthly income for retired workers.

(Compound annuity) what is the accumulated sum of each of the following streams of payme