Samantha wants to be able to withdraw $530 at the end of each month for two years while she travels, starting three years from now. If she invests $10,300 now to earn 4.54% compounded monthly until she begins to travel, what monthly compounded nominal rate of interest must she earn after she starts to travel? Do not include the dollar sign in your answers. Do not include the comma usually used to denote thousands. Do not include the percent sign in your answers. a.) What is the future value of the investment after the deferral period? b.) What is the nominal annual rate of interest compounded monthly? (Correct to 4 decimal places.) c) What is the effective annual rate of interest? (Correct to 4 decimal places.)

Excel Applications for Accounting Principles
4th Edition
ISBN:9781111581565
Author:Gaylord N. Smith
Publisher:Gaylord N. Smith
Chapter27: Time Value Of Money (compound)
Section: Chapter Questions
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Samantha wants to be able to withdraw $530 at the end of each month for two years while she
travels, starting three years from now. If she invests $10,300 now to earn 4.54% compounded
monthly until she begins to travel, what monthly compounded nominal rate of interest must she
earn after she starts to travel?
Do not include the dollar sign in your answers.
Do not include the comma usually used to denote thousands,
Do not include the percent sign in your answers.
a.) What is the future value of the investment after the deferral period?
b.) What is the nominal annual rate of interest compounded monthly? (Correct to 4 decimat
places)
c) What is the effective annual rate of interest? (Correct to 4 decimal places.)
Transcribed Image Text:Samantha wants to be able to withdraw $530 at the end of each month for two years while she travels, starting three years from now. If she invests $10,300 now to earn 4.54% compounded monthly until she begins to travel, what monthly compounded nominal rate of interest must she earn after she starts to travel? Do not include the dollar sign in your answers. Do not include the comma usually used to denote thousands, Do not include the percent sign in your answers. a.) What is the future value of the investment after the deferral period? b.) What is the nominal annual rate of interest compounded monthly? (Correct to 4 decimat places) c) What is the effective annual rate of interest? (Correct to 4 decimal places.)
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