Your grandfather left an inheritancefor you of $100,000. However you can only drawdown on the investment as follows:Years 1 –3$15,000 each year,Year 4 to 6$10,000each year, Year 7$25,000 Interest on the fund is 5%. a)What is the present worth of this inheritance? b)Due to high liquidity interest rate have dropped to 4%. What will be the impact onthe present worth of this inheritance as a consequence of the market change?

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Q: What is the present worth of this inheritance? b) Due to high liquidity interest rate have dropped…

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Q: Ronnie Cox has just inherited $27,000. How much of this money should he set aside today to have…

A: We know that, PV=FV(1 + r)t PV=$17000 (1 + 0.018)1 PV=$16,699.41

Q: Your grandfather placed $5,000 in a trust fund for you. In 12 years what will be the worth of the…

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Q: year

A: Period Value of Investment 5% Factor Present Value of Cash Flow 1. 15,000 0.952 14,280 2. 15,000…

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Q: Hugh invests 1000 in a fund on January 1. On May 1, the fund is worth 1,100 and 600 is withdrawn. On…

A: Simple interest is the interest paid or computed only on the principal amount of money. The amount…

Q: Suppose you inherited $935,000 and invested it at 8.25% per year. How much could you withdraw at the…

A: Annuity refers to an amount or stream of equal cash flows (CF) paid or received periodically.…

Q: Your grandfather left an inheritance for you of $100,000.  However you can only drawdown on the…

A: Present worth is the current value of the future payments at a given rate of return. Given: Interest…

Q: Sarah deposited $26,500 into a fund at the beginning of every quarter for 16 years. He then stopped…

A: Compound interest= p*(1+r%/n)^tn A.)  Around $358903 stacked up at the end of 16th year.

Q: 6. Your grandfather left an inheritance for you of $100,000. However you can only drawdown on the…

A: Ans ( a )  $17859.81 Ans (b)    $14705.23   Year            Project cash flows (i)      DF@5%…

Q: Your brother, who is 6 years old just received a trust fund that will be worth $25,000 when he is 21…

A: For this we will need to calculate the present value of the fund. using present value = future value…

Q: Susan Myer had invested $2500 in an ABC bank Certificate of Deposit when she inherited trust funds…

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A: A sinking fund is created to replace an existing machine. Future value of the sinking fund (FV) =…

Q: Fifteen years ago, you deposited $12,500 into an investment fund. Five years ago, you added…

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Q: Ronnie Cox has just inherited $27,000. How much of this money should he set aside today to have…

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A: Investment account: It is an investor’s account in which investments are managed.

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A: Redemption fee = worth of mutual fund x redemption fee%

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Q: Henry Quincy wants to withdraw $30,000 each year for 10 years from a fund that earns 8% interest.…

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Q: Suppose you make an annual contribution of P9,993 each year to a college fund for a niece. He is 6…

A: Annual contribution (P) = P 9,993 Period from 6th year to 19th year (n) = 13 Annual interest rate…

Q: Your grandfather left an inheritance for you of $100,00. However you can only drawdown on the…

A: Present value of fund can be calculated from annual cash flow using interest rate and period.

Q: Let's say you get a $8000 inheritance, and you wisely decide to put it into a long-term investment…

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A: Investment = 5000 Annual Return = 8% Time Period = 5 years

Q: A young man is the beneficiary of a trust fund established for him 18 years ago at his birth. If the…

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Q: Your friend, Kitty Kardashian, of Hidden Hills, CA, bought $7,000 worth of mutual funds with a…

A: In mutual fund there is redemption fee which goes on decreasing as time goes on.

Q: te

A: An annual or annualised return is a measurement of how much an investment has gained on average…

Q: A 1,000,000-trust fund was set up and to be used by an 8-year old nephew when he goes to college. In…

A:

Q: 6. Your grandfather left an inheritance for you of $100,000. However you can only drawdown on the…

A: Present value of the any investment is the sum of discounted intermediary and terminal values.

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Q: What are the After-tax annualized returns from the following two funds if you invest $1000 in each…

A: Compounding is a technique through which future value of present amount is calculated at fixed rate…

Reasons for Estate Planning

Planning is a process that helps decide in advance about future activities and operations. Planning helps to draft the procedures by identifying, analyzing, and designing how to work, when to work, by whom should be done, and what has to be done. It is the primary step followed by a person, business organizations, institutions, companies, etc.