New parents wish to save for their newborn's education and wish to have $40,000 should the parents place at the end of each year into a savings account that earns an annual rate of 4.5% compounded years. How much annually? (Round your answers to two decimal places.) How much interest would they earn over the life of the account? Determine the value of the fund after 11 years. How much interest was earned during the 11th year?

Q: What lump sum do parents need to deposit in an account earning 10%, compounded monthly, so that it…

A: Two questions appear on the board. They are unrelated and are not sub parts. Hence, only the first…

Q: Ethan wants to set up a fund for his son's education such that he could withdraw $2,982.00 at the…

A: Quarterly withdrawals (P) = $2,982.00 Period = 6 Years Quarterly period (n) = 6*4 = 24 Interest rate…

Q: On the birth of a child, the father wants to deposit a sum in a savings account. He intends to…

A: Sum Deposit = ? 20,000 every month for 4 years starting on 18th birthday Interest Rate = 10%…

Q: 6. To support his handicapped niece, Tony made payments of $1800 into a fund at the beginning of…

A: given data pmt = $1800  interest = 5.24% time period = 18 years fund deposited every 3 months   so…

Q: Parents have set up a sinking fund to have $180000 in 15 years for their child's education. How much…

A: Given information: Sinking fund (FV) = $180,000 Period (NPER) = 15 years Interest rate (rate) =5.2%…

Q: Grandparents plan to open an account on their grandchild's birthday and contribute each month until…

A: Annuity is type of financial instrument (insurance contract) in which you pay certain amount…

Q: Grandparents plan to open an account on their grandchild's birthday and contribute each month until…

A: a) Answer: Annuity due. Annuities are regular periodic payments made over a specified period. When…

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A: The process which helps a person in determining the amount required at the time of retirement and…

Q: . Your grandmother has established a trust fund that pays you $3,500 each year for 15 years. upon…

A: Given: CF=$3500t=15 yearsr=7% i.e 0.07

Q: If Luis Jimenez makes annual deposits of $1,000 into a savings account for 30 years, how much will…

A: Interest charged on the principal amount and the interest accrued is known as Compound Interest. It…

Q: Jane decides to make 5 end-of-year deposits of $10,000 into a fund starting one year from now. 6)…

A: Calculate the amount at the end of 5 years as below: Resultant Table: Hence, amount at the end of…

Q: Jim wants to deposit an amount anually to meet his retirement needs. Assume that he will deposit a…

A: In the span of 25 years, the interest rate is 6% on both the deposits and the withdrawals. First…

Q: Emile has deposited $100 at the start of each month to a savings fund for the last 3 ½ years. If the…

A: Monthly deposit = $ 100 Period = 3.50 Years = 3.5*12 = 42 Months Interest rate = 8% Quarterly…

Q: A newborn child receives a $7,000 gift toward a college education from her grandparents. How much…

A: Inerest rate (decimal form) = Interest rate100=5%100=0.05   Quarterly interest rate (decimal form)…

Q: New parents wish to save for their newborn's education and wish to have $35,000 at the end of 16…

A: Future value of annuity is the future value of the same cash flows that takes place at the end of…

Q: Since the birth of her granddaughter, 19 years ago, Holly has deposited $150 at the beginning of…

A: Given, The monthly deposit is $150. Interest is 3.25% for first 7 years and 3.75% for the next 12…

Q: Aylene is preparing for an income fund for her retirement. She wants to receive 15,000 pesos…

A: The annuity payments that are made at the beginning of the year are called annuity due and the ones…

Q: Since the birth of his granddaughter, 18 years ago, Kristen has deposited $300 at the beginning of…

A:

Q: You annually invest $1,000 in an individual retirement account (IRA) starting at the age of 30 and…

A: a)  Computation of my account balance:

Q: Since the birth of his granddaughter, 20 years ago, Jason has deposited $200 at the beginning of…

A: 1. FVA after 7 years   = P * (([1 + I]^N - 1 )*(1+I))/I, where P is the payment amount= 200 I is…

Q: A young couple wants to have a college fund that will pay $20,000 at the end of each half-year for 8…

A: Here, The interest Rate is 6% Required Amount is $20,000 at the end of each half-year for 8 years…

Q: Grandparents plan to open an account on their grandchild's birthday and contribute each month until…

A: Future value required (FV) = $ 200,000 Interest rate = 5% Monthly interest rate (r) = 5%/12 =…

Q: You annually invest $2,000 in an individual retirement account (IRA) starting at the age of 30 and…

A: Since, in this question fixed amount is invested each year. So, it is the question of annuity.…

Q: What lump sum do parents need to deposit in an account earning 11%, compounded monthly, so that it…

A: Given: Interest rate = 11% Future value = $90,000 Years = 16 Compounding is monthly

Q: To pay for your child’s education, you wish to have accumulated $25,000 at the end of 15 years. To…

A: Future Value refers to compounded value of present amount or a series of equal amount of payment…

Q: To fund their child's college expenses, a family plans to invest $540 to a bank account at the end…

A: This is in the form of a growing annuity where the initial amount is 540 G = 12% (growth rate) and r…

Q: A father has saved a fund to provide for his son's 4-year university program. The fund will pay…

A: To calculate value of fund, present value of annuity formula will be used. Value of fund will…

Q: What principal must be deposited by the parents when their child is born in order to have

A: The time value of money implies that the cash in hand at present has a higher value than the cash…

Q: A couple plans to save for their child's college education. What principal must be deposited by the…

A: Present Value  Present value is the present worth of any sum of a money to be received in the future…

Q: What lump sum do parents need to deposit in an account earning 10%, compounded monthly, so that it…

A: As per our guidelines we are supposed to answer only one question (if there are multiple questions…

Q: A family wants to have a $160,000 college fund for their children at the end of 15 years. What…

A: Using excel PMT function

Q: Since the birth of his granddaughter, 20 years ago, Jacob has deposited $100 at the beginning of…

A: Monthly Deposit = 100 Beginning of period deposits   First 11 years: Interest Rate = 4.50%/12  Time…

Q: New parents wish to save for their newborn's education and wish to have $47,000 at the end of 19…

A: Given: Future value = $47,000 Years = 19 Interest rate = 4.3%

Q: how much do they need to invest at the end of each 6-month period for the next 18 years to begin…

A: The present value of an annuity: A=R[(1-(1+i)-n)i] A=35,000[(1-(1+0.03)-16)0.03] A = 439,639

Q: Ann and Tom want to establish a fund for their grandson's college education. What lump sum must they…

A: To calculate the deposit amount we will use the present value formula as follows:   Deposit amount =…

Q: Assume the money earns 7% interest, compounded quarterly

A: Interest rate is i=7% compounded quaterly no. of periods in a year n=4 *1=4 Time t = 18 years amount…

Q: Harry plans to deposit $3,000 at the beginning of each year into a savings account earning 2.75%…

A: The amount which is deposited at the beginning of each period is called as annuity due. The period…

Q: Grandparents plan to open an account on their grandchild's birthday and contribute each month until…

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

Q: What principal must be deposited

A: Compound interest is the amount of interest that is added with the principal amount of deposit or…

Q: A mother wishes to put enough money in a fund today for her son to attend college starting in 10…

A: Determine the value of fund at the end of 10 years assuming that the college fees is to be paid at…

Q: A couple plans to save for their child’s college education. What principal must be deposited by the…

A: Savings refers to money put aside for some specific work or for emergency needs. Saving is used to…

Q: What lump sum do parents need to deposit in an account earning 10%, compounded monthly, so that it…

A: The present value of a future amount can be calculated by using this equation Present value =Future…

Q: Since the birth of her granddaughter, 21 years ago, Kevin has deposited $150 at the beginning of…

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

Q: A person sets up a sinking fund in order to have P100,000 after 10 years for his children’s college…

A: Future Value Required = 100,000 Time Period = 10 years or 20 semi annual periods Interest Rate =…

Q: A family wants to have a $220,000 college fund for their children at the end of 16 years. What…

A: The series of regular payment at the end of each specified intervals is known as ordinary annuity.…

Q: A young couple wants to have a college fund that will pay $40,000 at the end of each half-year for 8…

A: Time value of money refers that, a sum of money today has more value than the same amount received…

Q: How much money will be in the account when the child turns 18?

A: Time value of money(TVM) means that the money received in the present days will have more value…