Henry Jones is planning to retire in 15 years. He wishes to deposit an equal amount (A) every 6 months until he retires so that, beginning after six months following his retirement, he will receive semiannual payments of $10,000 for the next 10 years. Determine the value of A which he must deposit if the interest rate is 14%, compounded semi-annually.

Henry Jones is planning to retire in 15 years. He wishes to deposit an equal amount (A) every 6 months until he retires so that, beginning after six months following his retirement, he will receive semiannual payments of $10,000 for the next 10 years. Determine the value of A which he must deposit if the interest rate is 14%, compounded semi-annually.

Intermediate Accounting: Reporting And Analysis

3rd Edition

ISBN:9781337788281

Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach

ChapterM: Time Value Of Money Module

Section: Chapter Questions

Problem 10E: Amount of an Annuity John Goodheart wishes to provide for 6 annual withdrawals of 3,000 each...

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Next Level Potter wishes to deposit a sum that at 12% interest, compounded semiannually, will permit 2 withdrawals: 40,000 at the end of 4 years and 50,000 at the end of 10 years. Analyze the problem to determine the required deposit, stating the procedure to follow and the tables to use in developing the solution.
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Amount of an Annuity John Goodheart wishes to provide for 6 annual withdrawals of 3,000 each beginning January 1, 2029. He wishes to make 10 annual deposits beginning January 1, 2019, with the last deposit to be made on January 1, 2028. Required: If the fund earns interest compounded annually at 10%, how much is each of the 10 deposits?