Sherry is a 25-year-old who just started working. At age 25 she received, she received $20 000 from her parents and wants to explore saving / investment options so she can purchase property at the age of 40. She went to a financial institutions, and they gave her the following flyer: Great Savers Bank (Ordinary Annuity) Deposit $140 monthly We compound annually at 4.5% Collect at 15 years Special Terms Allows one withdrawal every 3 years. If done your final payment will be 1.25% less than the projected value. Based on the Bank Flyer above, calculate: 1) The interest which will be earned. 2) The future value of the policy 3) The payout options available 4) How the investment will grow over time
Sherry is a 25-year-old who just started working. At age 25 she received, she received $20 000 from her parents and wants to explore saving / investment options so she can purchase property at the age of 40. She went to a financial institutions, and they gave her the following flyer: Great Savers Bank (Ordinary Annuity) Deposit $140 monthly We compound annually at 4.5% Collect at 15 years Special Terms Allows one withdrawal every 3 years. If done your final payment will be 1.25% less than the projected value. Based on the Bank Flyer above, calculate: 1) The interest which will be earned. 2) The future value of the policy 3) The payout options available 4) How the investment will grow over time
Chapter5: The Time Value Of Money
Section: Chapter Questions
Problem 14P
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Transcribed Image Text:Sherry is a 25-year-old who just started working. At age 25 she received, she received $20 000 from her
parents and wants to explore saving / investment options so she can purchase property at the age of 40.
She went to a financial institutions, and they gave her the following flyer:
Great Savers Bank
(Ordinary Annuity)
Deposit $140 monthly
We compound annually at 4.5%
Collect at 15 years
Special Terms
Allows one withdrawal every 3 years. If done your final payment will be
1.25% less than the projected value.
Based on the Bank Flyer above, calculate:
1) The interest which will be earned.
2) The future value of the policy
3) The payout options available
4) How the investment will grow over time
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