If the present value of a cash flow at an annual rate of interest of 4.5 %is $30000, what is the yearly cash flow? Assume that interest iscompounded annually and round to the nearest cent.The yearly cash flow isTIPEnter your answer as an integer or decimal number. Examples: 3,-4, 5.5172Enter DNE for Does Not Exist, oo for Infinity

When the interest is compounded, then the formula used is A=P1+rnnt , where, A is the final amount,…

Answered: If the present value of a cash flow at…

College Algebra

7th Edition

ISBN:9781305115545

Author:James Stewart, Lothar Redlin, Saleem Watson

Publisher:James Stewart, Lothar Redlin, Saleem Watson

Chapter8: Sequences And Series

Section: Chapter Questions

Problem 8CC

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Equity in a Home When you purchase a home by securing a mortgage, the total paid toward the principal is your equity in the home. Technically, the lending agency calculates your equity by subtracting the amount you still owe on your mortgage from the current value of your home, which may be higher or lower than your principal. Assume that your mortgage is for 350, 000 at a monthly rate of 0.007 as a decimal and that the term of the mortgage is 30 years. Then your equity after k monthly payments is 350, 0001.007k-11.007360-1 dollars. Calculate the equity in your home after 10 years.
The Truth in Lending Act Many lending agencies compound interest more often than yearly, and, as we noted in Example P.2, they are required to report the annual percentage rate, or APR, in a prominent place on the loan agreement. Furthermore, they are required to calculate the APR in a specific way. If r is the monthly interest rate, then APR is calculated using APR=12r. a. Suppose a credit card company charges a monthly interest rate of 1.9%. What APR must the company report? b. The phrase annual percentage rate leads some people to believe that if you barrow 6000 from a credit card company that quotes an APR of 22.8%, and if no payments are made, then at the end of 1 year, the interest would be calculated as 22.8% simple interest on 6000. How much would you owe at the end of a year if interest is calculated in this way? c. If Interest is calculated monthly which is common, then the actual amount you would owe in the situation of part b is given by 60001.01912. What is the actual amount you would owe at the end of a year?
To get the best loan rates available, the Riches want to save enough money to place 20% down on a $160,000 home. They plan to make monthly deposits of $125 in an investment account that offers 8.5% annual interest compounded semiannually. Will the Riches have enough for a 20% down payment after five years of saving? How much money will they have saved?

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If the present value of a cash flow at an annual rate of interest of 4.5% is $30000, what is the yearly cash flow? Assume that interest is compounded annually and round to the nearest cent. The yearly cash flow is s