Suppose a two-bedroom apartment today cost $715 in rent. Find the monthly rent in 30 years for this same apartment assuming a constant inflation rate (compounded continuously) of 4.5%. Round your answer to the nearest cent and include units. Make sure you show the formula you used and the values you filled in.

Suppose a two-bedroom apartment today cost $715 in rent. Find the monthly rent in 30 years for this same apartment assuming a constant inflation rate (compounded continuously) of 4.5%. Round your answer to the nearest cent and include units. Make sure you show the formula you used and the values you filled in.

Entrepreneurial Finance

6th Edition

ISBN:9781337635653

Author:Leach

Publisher:Leach

Chapter13: Other Financing Alternatives

Section: Chapter Questions

Problem 1bM

See similar textbooks

Similar questions

You want to invest $8,000 at an annual Interest rate of 8% that compounds annually for 12 years. Which table will help you determine the value of your account at the end of 12 years? A. future value of one dollar ($1) B. present value of one dollar ($1) C. future value of an ordinary annuity D. present value of an ordinary annuity
Find the cost of the monthly rent for a two-bedroom apartment in 30 years, assuming an inflation rate of 4% (compounded continuously), if the current rent is $750. (Round your answer to the nearest cent.)$
Assume you are thinking of buying a house currently priced at $169,000. If housing prices rise at an annual inflation rate of 3%, estimate the purchase price of a similar house if you wait 4 years before committing yourself to buying one. Suppose when you are 52 years old, the yearly statement you get from the Social Security Administration estimates that your monthly payment at age 66 will be $620. If inflation stays constant at 2%, what will be the purchasing power of that $620? Calculate the effective annual rate for an investment that earns 7.1% interest compounded quarterly. Round to the nearest hundredth of a percent. What is the effective annual interest rate of an investment that pays 7.6% annual interest, compounded quarterly? Round to the nearest hundredth of a percent
Find the cost of each item in 11 years, assuming an inflation rate of 11% (compounded continuously). (Round your answers to the nearest cent.) (a) phone bill, $32$ (b) pair of shoes, $62$ (c) new suit, $395$ (d) monthly rent, $650
Assume you are thinking of buying a house currently priced at $169,000. If housing prices rise at an annual inflation rate of 3%, estimate the purchase price of a similar house if you wait 4 years before committing yourself to buying one.
Suppose that an insurance agent offers you a policy that will provide you with a yearly income of $40,000 in 30 years. What is the comparable salary today, assuming an inflation rate of 5% compounded annually? (Round your answer to the nearest cent.)
Today, a typical family of four spends $897.20/month for food.† If inflation occurs at the rate of 2%/year over the next 6 years, how much should the typical family of four expect to spend for food 6 years from now? (Round your answer to the nearest cent.)
Find the cost of each item in 5 years, assuming an inflation rate of 7% (compounded continuously). (Round your answers to the nearest cent.) (a) cup of coffee, $3.75 $ ____________________(b) Sunday paper, $2.75 $ _______________(c) Big Mac, $4.10 $ ______________(d) gallon of gas, $3.45 $___________
You decide to buy a house costing $5,000,000. You pay $1,000,000 down, and the remainder will be paid in monthly installments over 30 years at 3.5% compounded monthly. What is the monthly payment? What is the outstanding balance after making the 100th payment? What is the equity after making the 100th payment? How much of the 100th payment will go to principal and how much to interest? How much interest will paid over the entire length of the loan?
The annual income from an apartment house is $33,600. The annual expense is estimated to be $8000. If the apartment house can be bought today for $349,000, what is the breakeven resale price in 10 years with a 6% interest rate?
If the inflation rate is 6% per year, how many (future) dollars will be required 10 years from now to buy the same things that $15,000 buys now? Solve manually please
Suppose you purchase an insurance policy today that will provide you with $250,000 when you retire in 25 years. Assuming an annual inflation rate of 5%, what will be the purchasing power (in dollars) of a $250,000 in 25 years? Round your answer to the nearest cent