Topic: Time Value of Money and Annuity1. If you deposit $10 in an account that pays an interest of 5%, compoundedannually, how much will you have at the end of 10 years? 50 years? 100years?2. Complete the following table solving for the present value PV:CaseFVInterest rate5%No. of periodsPV$10,000$563,000$5000A.578354%205.5%33. Suppose you want to have $ 0.5 million saved by the time you reach age 30 and supposethat you are 20 years old now. If you can eam 5% on your funds, how much would youhave to invest today to reach your goal?5 million4. How much would you have to deposit in an account today that pays 12% interest,compounded quarterly, so that I have a balance of $20,000 in the account at the end of 10years?= 61315. Calculate the present value of an annuity-immediate of amount$200 paid annually for 10 years at the rate of interest of 12% per annum. Also calculateits future value at the end of 10 years.PV= 1130

1. If you deposit $10 in an account that pays an interest of 5%, compounded annually, how much will you have at the end of 10 years? 50 years? 100 years? 2. Complete the following table solving for the present value PV: FV $10,000 $563,000 $5000 Case A. No. of periods Interest rate 5% 4% 5.5% PV 7835 20 C 3 3. Suppose you want to have $ 0.5 million saved by the time you reach age 30 and suppose that you are 20 years old now. If you can earn 5% on your funds, how much would you have to invest today to reach your goal? 5 million 4. How much would you have to deposit in an account today that pays 12% interest, compounded quarterly, so that I have a balance of $20,000 in the account at the end of 10 years? - 6131 5. Calculate the present value of an annuity-immediate of amount $200 paid annually for 10 years at the rate of interest of 12% per annum. Also calculate its future value at the end of 10 years. PV- 1130

1. If you deposit $10 in an account that pays an interest of 5%, compounded annually, how much will you have at the end of 10 years? 50 years? 100 years? 2. Complete the following table solving for the present value PV: FV $10,000 $563,000 $5000 Case A. No. of periods Interest rate 5% 4% 5.5% PV 7835 20 C 3 3. Suppose you want to have $ 0.5 million saved by the time you reach age 30 and suppose that you are 20 years old now. If you can earn 5% on your funds, how much would you have to invest today to reach your goal? 5 million 4. How much would you have to deposit in an account today that pays 12% interest, compounded quarterly, so that I have a balance of $20,000 in the account at the end of 10 years? - 6131 5. Calculate the present value of an annuity-immediate of amount $200 paid annually for 10 years at the rate of interest of 12% per annum. Also calculate its future value at the end of 10 years. PV- 1130

Cornerstones of Financial Accounting

4th Edition

ISBN:9781337690881

Author:Jay Rich, Jeff Jones

Publisher:Jay Rich, Jeff Jones

ChapterA3: Time Value Of Money

Section: Chapter Questions

Problem 11E

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