Question

ow much would you have to invest today to receive the following? Use Appendix B or Appendix D for an approximate answer, but calculate your final answer using the formula and financial calculator methods.

  
a. $15,250 in 11 years at 7 percent. (Do not round intermediate calculations. Round your final answer to 2 decimal places.)
  

b. $19,600 in 18 years at 11 percent. (Do not round intermediate calculations. Round your final answer to 2 decimal places.)
  

c. $8,000 each year for 14 years at 8 percent. (Do not round intermediate calculations. Round your final answer to 2 decimal places.)
  

d. $55,000 each year for 20 years at 14 percent. (Do not round intermediate calculations. Round your final answer to 2 decimal places.)

Answer 1

Using financial calculator BA II Plus - Input details:	a	b	c	d
I/Y = Rate or yield / frequency of coupon in a year =	7.000000	11.000000	8.000000	14.000000
PMT = Payment = Coupon / frequency =	$0.00	$0.00	$0.00	$0.00
N = Total number of periods = Number of years x frequency =	11	18	14	20
FV = Future Value =	-$15,250.00	-$19,600.00	-$8,000.00	-$55,000.00
CPT > PV = Present Value of the instrument =	$7,245.17	$2,995.31	$2,723.69	$4,001.89
Formula: PV = FV / (1+R)^N =	=15250/(1+7%)^11	=19600/(1+11%)^18	=8000/(1+8%)^14	=55000/(1+14%)^20

a.	$7,245.17
b.	$2,995.31
c.	$2,723.69
d.	$4,001.89