Question

How much will I need to deposit into an account to have $6,500,000 in 10 years earning 5 % compounded annually?

Expert Answer

Want to see the step-by-step answer?

Check out a sample Q&A here.

Want to see this answer and more?

Experts are waiting 24/7 to provide step-by-step solutions in as fast as 30 minutes!*

*Response times may vary by subject and question complexity. Median response time is 34 minutes for paid subscribers and may be longer for promotional offers.
Tagged in
Business
Finance

Future value and Present value

Related Finance Q&A

Find answers to questions asked by students like you.

Q: | Click the icon to view the credit card statement. a. Find the average daily balance for the billin...

A: In banking average daily balance is the balance required by the accountholders to maintain in their ...

Q: Which of the following statements is true? Group of answer choices The Principle of Diversificatio...

A: Diversification is investing our money in different asset classes so that we can minimize risk  

Q: Chang bought a desktop computer and a laptop computer. Before finance charges, the laptop cost $200 ...

A: It is the amount charged on the asset a particular interest rate.   

Q: Betty Kay has a contract in which she will receive the following payment for the next 5 year: $1,000...

A: We should find pv of cash flows and if the present value is more than 30000 we should reject the off...

Q: Problem 9-18 Assume that the risk-free rate of interest is 5% and the expected rate of return on the...

A: According to CAPM model, Ke=Rf+beta ×Rm-Rf GIVEN, Rf = 5% Rm= 12% beta actual = 1 beta assumed = 0.5...

Q: Consider Donald and Joe who are both 30- years of age and recently graduated with a degree in Financ...

A: A theory that helps to compute the present or future value of the cash flows is term as the TVM (tim...

Q: What is the semi-annual coupon bond’s nominal yield to maturity (YTM), if the years to maturity is 1...

A: It is required to compute the price of the bond at different rate of the yield to maturity to determ...

Q: Use the information from this table to calculate the correlation coefficient for the assets.   S...

A: Following are the information given: Return on Asset J           Return on Asset K 5%               ...

Q: The following information is for Rainbow National Bank: Report of Income $ Interest income...

A: ROE is the measure of a company’s profitability in relation to its equity. ROA is the measure of a c...

Q: Use the information from this table to find the covariance for each asset.   State of Economy ...

A: Er=p1 x r1+(p2 x r2)+(p3 x r3)+(p4 x r4)E(r)J=0.3 x 5%+0.4 x 5%+0.2 x 5%+0.1×5%=5%E(r)k=0.3 x 24%+0....

Q: Kings park water works user water meters that measure water usage in ccf. They charge $0.22 per ccf ...

A: Prevoius reading =34412 ccfPresent reading=36209 ccfCharge of water per ccf =$0.22

Q: A car is purchased with a 48-month, 9% nominal loan with an initial balance of $15,000. What is the ...

A: A theory that helps to compute the present or future value of the cash flows is term as the TVM (tim...

Q: Determine the future worth of 20 quarterly lease payments of $500 at an interest rate of 8%.

A: An agreement through which a party lets another party use the assets or resources on rent is term as...

Q: City Bank offers a 7-year CD with a nominal rate of interest of 7%. If compounding occurs continuous...

A: continuous compounding effective annual rate =  e^r - 1 where, r = rate of interest i.e. 7% or 0.07 ...

Q: Problem 6-24 Suppose that the borrowing rate that your client faces is 12%. Assume that the S&P 500 ...

A: Risk aversion is a human nature. Investor with risk aversion nature prefers lower return with low ri...

Q: A pension fund manager is considering three mutual funds. The first is a stock fund, the second is a...

A: Formulas:

Q: Condiser Donald and Joe who are both 30 years of age and recently graduated with a degree in Finance...

A: A theory that helps to compute the present or future value of the cash flows is term as the TVM (tim...

Q: You want to borrow $1,000 at an interest rate of 10%. The most expensive method of calculating the d...

A: Informantion provided: Borrowing amount = $1000 Interest rate = 10%   Definitions: Simple interest r...

Q: Use the ordinary interest method, 360 days, to solve the following word problem. Round to the neares...

A: Here, Interest Rate of Promissory Note is 8.6% Face Value of Promissory Note is $800,000 Time Durati...

Q: What are the reasons for Uniqlo's global success? How would you summarize Uniqlo’s basic strategy?

A: Fast Retailing Company Limited fully owns Uniqlo as a subsidiary. The brand value of Uniqlo is $8.6 ...

Q: An industrial coal-fired boiler for process steam is equipped with a 10-year-old electrostatic preci...

A: Net present value is used to calculate the existing value of future cash flows for decision making.

Q: Kaylee Fernandez came into some money from her trust fund and now has $120,000. Kaylee’s colleagues ...

A: The process of evaluating and selecting the best suitable alternative from the number of alternative...

Q: Exercise 4.4 A whole life insurance policy issued to a life aged exacıly 20 has an increasing sum in...

A: Insurance policy is the policy which is purchased by a person to get the compensation for the loss i...

Q: Assume that the real risk-free rate is 1.9% and that the maturity risk premium is zero. If a 1-year ...

A: Bonds: These are the money market instruments that generate fixed income for the bondholders. These ...

Q: A student loan for $32,000 is paid back in monthly payments over ten years with an interest rate of ...

A: Annuity refers to series of annual payment which are paid or received at start or end of specific pe...

Q: Compare the machines in the following table based on their present value, using an 18% annual intere...

A: The present value is the value of the sum received at time 0 or the current period. It is the value ...

Q: If a firm’s ROE is low, and management wants to improve it, explain how using more debt might help.

A:  The Return on equity (ROE) is used for measuring the financial performance of the firm. it shows ef...

Q: I need someone to check my answer Top hedge fund manager Sally Buffit believes that a stock with th...

A: Discount rate is the rate which is expected to be generated from the investment. It is also known as...

Q: (a) What is the balance due on the original mort- gage (20 payments have been made in the last 5 yea...

A: Refinancing the loan means taking other loan in place of existing loan. After refinancing, the inter...

Q: You have been requested to recommend one of the mutually exclusive industrial sanitation control sys...

A: The conceptual formula is:

Q: Suppose that you decide to buy a car for $60,000, including taxes and license fees. You saved $11,00...

A: A theory that helps to compute the present or future value of the cash flows is term as the TVM (tim...

Q: Two pieces of construction equipment are being analyzed.At an 8% interest rate, which alternative sh...

A: The process through which a business evaluates major projects or alternatives before accepting or re...

Q: Thompson Company gathered the following reconciling information in preparing its October bank reconc...

A: Bank Reconciliation Statement(BRS) is statement showing different transaction or errors due to which...

Q: Use the information from this table to find the variance for each asset.   State of Economy Pr...

A: Formulas for asset J:

Q: Which of the following statements is false? Group of answer choices Stocks are long-term securitie...

A: Stocks are ownership while bonds are liabilities to the firm   

Q: Problem 7-23 Greta, an elderly investor, has a degree of risk aversion of A = 4 when applied to retu...

A: To reduce the risk, generally investors invest in different securities so that overall risk will be ...

Q: Monthly payment of loan b, rounded to the nearest cent

A: Monthly payment for the loan is the amount paid for loan over a time.

Q: You have a chance to buy an annuity that pays $2,500 at the end of each year for 3 years. You could ...

A: Given,  The amount of annuity payment is 2,500 Number of years 3 Rate of interest is 5.5%

Q: 5) A certain non-dividend paying stock is trading at $50 and its volatility 25%. The risk-free inter...

A: A put option contract gives the owner the right but not the obligation to sell an underlying asset. ...

Q: For the following table, assume a MARR of 10% per year and a useful life for each alternative of six...

A: IRR in the rate of return a project generates in its lifetime. It is expressed in annual terms. IRR ...

Q: Suppose you pay 10 to buy a European (K = 100, t = 2) call option on a given security. Assuming a co...

A: Given: Cost of Call Option: $10 Strike Price -  K: $100 Time Period -t: 2 Interest Rate: 6% per year...

Q: What will be the present value if $6,800 is discounted back 4 years at an interest rate of 4% compou...

A: The present value is the value of the sum received at time 0 or the current period. It is the value ...

Q: Consider Donald and Joe who are both 30- years of age and recently graduated with a degree in Financ...

A: Amount they will have is future value of monthly savings