For a sum of money interetsed at 4% compunded semi- annually for 5 years. a) nominal rate of interest b) the periods rate of interest c) the compunding factors d) the numerical value of compounding factors

For a sum of money interetsed at 4% compunded semi- annually for 5 years. a) nominal rate of interest b) the periods rate of interest c) the compunding factors d) the numerical value of compounding factors

Financial Accounting Intro Concepts Meth/Uses

14th Edition

ISBN:9781285595047

Author:Weil

Publisher:Weil

ChapterA: Appendix - Time Value Of Cash Flows: Compound Interest Concepts And Applications

Section: Chapter Questions

Problem 18E

See similar textbooks

Related questions

Q: 7 is invested at the end of each 6 months for 6 equal payments at 0.27 compounded semi - annually.…

A: Given information : Periodic investment $ 1,287.00 Interest rate 27% Total installments 6…

Q: If interest is 5% compounded annually, calculate the present value of five year cash flows of $1,000…

A: The present value function or concept can be used to determine the present value of a future sum or…

Q: Determine the future value of $10,000 under each of the following sets of assumptions:…

A: Future value: It is the value of money or asset for a specific period at a future date based on the…

Q: What is the present worth of the followingseries of payments?(a) $1,500 at the end of each year for…

A: A series of recurring fixed payments over a particular period of time is called as annuity. To…

Q: An amount of money P is deposited in a savings account that pays interest at a rate of r percent per…

A: It is simple formula which compounds the principal amount at number of times in a year. We use this…

Q: What is the accumulated amount of five-year annuity paying P6,000 at the end of each year, with…

A: The worth of a present asset in the future based on a projected growth rate is referred to as future…

Q: If money is worth 9% compounded annually, which of the following obligations is more valuable? Use…

A: The present value is the worth of amount that has to be received/paid in the future.

Q: annual, semiannual, and quarterly compunding periods, (1) calculate the future value i f$4000 is…

A: Future value can be computed using FV function in excel. FV function computes interest rate for…

Q: a. Calculate the future sum of P5,000, given that it will be held in the bank five years at an…

A: Note 1)It is a case where no sub-part is specified to solve among the multiple sub-parts posted, so…

Q: Find the amount of the loan and construct the first four rows of the amortization table

A: Semi-Annual Payments(P) = P1350 Interest Rate(r) =5%/2 = 2.5% = 0.025 Years = 3.5 years Terms(n)…

Q: Calculate the repayments required to fully repay $100 000 borrowed at 6%p.a. for 10 years with…

A: Borrowed amount "PV" is $100,000 Time period is 10 years Total number if quarters "N" are 10×4=40…

Q: A sum of 45000 invested will provide payments of 500 each at the end of every 2 months for 7 years…

A: Compound interest is interest on interest. In case of compound interest…

Q: Suppose that a certain EOY (end of year) cash flows are expected to be $1,000 for the second year,…

A: End of year cash flows are those cash flows which are generated at the end of each year for an…

Q: If Php 1,000 becomes Php 1,811.36 after 5 years when invested at an unknown rate of interest…

A: Deposit amount = Php. 1000 Future value = Php. 1811.36 Period = 5 Years

Q: Determine the interest rate per year, compounded quarterly, which is needed for a principal amount…

A: Given Present value (PV) = OMR 27000 Future value (FV) = OMR 43995.75 Period = 8 years Interest…

Q: What is the compound interest and accumulated value of: 30,000 principal , 7% rate that is…

A: Compound Interest is the interest that is calculated on the initial principal plus the accumulated…

Q: Determine the amount after 6 years assuming P25,000 was the initial deposit and succeeding deposits…

A: Time value of money (TVM) refers to the method or technique which is used to measure the amount of…

Q: Determine the present value of the following cash flows; P4,000 at the end of 4th month and every…

A: Given information= P4000 at the end of 4th month and every month thereafter till the 12th Month…

Q: being kompounded 25000$ is deposited in an account that pays 5% interest, semi-annually. Equal…

A: Here the 5% interest is compounded semi-annually and hence we will first have to find the effective…

Q: At the end of each quarter-year, for 6 years, $1,200 is deposited into an investment paying 3.4%…

A: At the end of each quarter-year, for 6 years, $1,200 is deposited into an investment paying 3.4%…

Q: Using Table 11-1, compute the amount of compound interest (in $) earned in 1 year and the annual…

A: Principle amount = 32000 Interest rate = 12% (Compounded monthly) Time period = 1 year

Q: iannual, and quarterly compunding periods, (1) calculate the future value i f $10,000 is deposited…

A: Future value can be computed using FV function in excel. FV function computes interest rate for…

Q: Calculate the compounded interest after 7 years and 9 months if 500,000 is placed at an annual rate…

A: a) Amount invested (A) = 500,000 n = 7 years 9 months = 93 months r = 11.28% per annum = 0.94% per…

Q: n the information given int he following case, determine the number of years that the given oridinay…

A: Initial amount (PV) = $ 26,800 Annual cash flow (P) = 6,561 Rate of return (r) = 6% Number of year =…

Q: Find the compound amount if P5,000 is invested at 10% compounded semi-annually for 2 years.

A: Compund Amount = PV * (1 + r/n)^ntWhere PV = Present Value = P5,000r = rate of interest = 10%n=…

Q: An amount of $6,880 is deposited into an account earning 3% interest compounded quarterly. How much…

A: Future Value: The future value is the amount that will be received at the end of a certain period.…

Q: 18,000$ is deposited for 9 years in an account earning 5% interest. Round answers to two decimal…

A: Future Value The future value is the worth of any asset or any sum of money at a future date when…

Q: cash flows are received on a semi-annual basis; the effective semiannual interest rate, if it is 3%…

A: Given, period interest rate is 3% per quarter compounded quarterly We need to find out effective…

Q: calculate the principal sum which, if deposited at 9.5% compound interest, will grow to £400 after…

A: Interest rate (r) = 9.5% compounded Future value (A) = £400 Time (n) = 3 years Principal (P) = ?

Q: Suppose $1,200 is deposited into an account which has an annual percentage rate of 9.81% per year.…

A: The question is based on the concept of Financial Accounting

Q: What is the present worth of the followingseries of payments?(a) $5,000 at the end of each six-month…

A: Periodic Payment = 5000 Semi Annual Compounding, Hence: Time Period = 12 years * 2 = 24 semi annual…

Q: Compare the intarest earned by $8,000 for five years at 8% simpile interest with interest eamed by…

A: Simple interest: Simple interest is the amount of interest that is determined for a principal amount…

Q: A one-time investment is made in the amount of $9,200 for 15 years at an APR of 6%. Compound…

A: given, principal = $9200 rate = 6%

Q: Find the present value of $500 due in five years under each of the following conditions: a. 12…

A: The question is asking about the present value of $ 500 due after 5 year at discount rate 12% but in…

Q: Suppose that $3000 is deposited in a saving account at the rate of 8% per year. Determine in details…

A: Given data, Principal (P) = $3000 Interest rate (r) = 8% per year…

Q: Compare the interest earned by P dollars at i% per year simple interest with that earned by the same…

A: Time value of money- It is based on the concept that money earned today is worth more than similar…

Q: compute the amount of compound interest (in $) earned in 1 year and the annual percentage yield…

A: Compound Interest is the interest that is calculated on the initial principal and on the interest…

Q: How much must be deposited at 6% each year beginning on January 1, year 1, in order to accumulate…

A: This is the question related to compound interest and Future Amount. We use Principal , Interest and…

Q: Using Table 11-1, compute the amount of compound interest (in $) earned in 1 year and the annual…

A: Given, Principal amount $33,000. Nominal rate=12%.

Q: Determine the present value of $210,000 to be received at the end of each of four years, using an…

A: Formula: Present value of Amount = yearly Amount x PV factor Multiplying yearly amounts with PV…

Q: FIND THE AMOUNT OF 12,000 AFTER 2 YEARS COMPOUNDED ANNUALLY, THE RATE OF INTEREST BEING 5 DURING THE…

Q: CalculatorDetermine the present value of $43,000 to be received in one year, at 6% compounded…

Q: Determine the present value of $200,000 to be received at the end of each of four years, using an…

Q: Solve for the compound amount and compound interest at the end of 1 year if S7,000 is invested at 4%…

A: An interest rate method in which current interest is computed by multiplying the interest rate by…

Q: Determine how much is in each account on the basis of the indicated compounding after the specified…

A: As per the guidelines we are allowed to solve the first three parts only The account value can be…

Concept explainers

Present Value

Present value (PV) is defined as the current or present value of all future sums of cash flow or money at a specified rate of return. This rate of return is known as the discounted rate, which is essentially the interest rate, discounted over some time. The expected cash flows are discounted at a discount rate to compute the present value. The higher the discount rate, the higher the future value (FV), but the lower the present value.

Question

For a sum of money interetsed at 4% compunded semi- annually for 5 years.

a) nominal rate of interest

b) the periods rate of interest

c) the compunding factors

d) the numerical value of compounding factors

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

This is a popular solution!

SEE SOLUTION Check out a sample Q&A here

Step 1

VIEW

Step 2

VIEW

Step 3

VIEW

Trending now

This is a popular solution!

Step by step

Solved in 3 steps

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, finance and related others by exploring similar questions and additional content below.

Similar questions

Sharapovich Inc. borrowed $50,000 from Kerber Bank and signed a 5-year note payable stating the interest rate was 5% compounded annually. Sharapovich Inc. will make payments of $11,548.74 at the end of each year. Prepare an amortization table showing the principal and interest in each payment.
Halep Inc. borrowed $30,000 from Davis Bank and signed a 4-year note payable stating the interest rate was 4% compounded annually. Halep Inc. will make payments of $8,264.70 at the end of each year. Prepare an amortization table showing the principal and interest in each payment.
Future Value Hugh Colson deposited 20,000 in a special savings account that provides for interest at the annual rate of 12% compounded semiannually if the deposit is maintained for 4 years. Required: Calculate the balance of the savings account at the end of the 4-year period.
Cash Flow Amounts R. Lee Rouse borrows 10,000 that is to be repaid in 24 equal monthly installments payable at the end of each subsequent month with interest at the rate of 1% per month. Required: Using the appropriate table, calculate the equal installments.