When you were born, your dear old aunt minnie promised to deposit $500 into a savings...

When you were born, your dear old aunt minnie promised to deposit $500 into a savings account bearing a 5% compounded annual rate on each birthday, beginning with your first. You have just turned 21 and want the dough. However, it turns out that dear old (forgetful) aunt minnie made no deposits on your fifth and eleventh birthdays. How much is in the account right now?

Solutions

Expert Solution

Original deposit annual	500
Amount on 4th birthday	$2,155.06
Amount on 5th birthday	$2,262.82

Amount on 10th birthday	$5,650.81
Amount om 11th birthday	$5,933.35

Amount on 21st birthday	$15,953.74

WORKINGS

jeff jeffy answered 1 week ago

Next > < Previous

Related Solutions

your wonderful parents established a college savings plan for you when you were born. They deposited...

your wonderful parents established a college savings plan for you when you were born. They deposited $50 into the account on the last day of each month. The account has earned 10% compounded monthly. Now you are off to Monash university. What equal amount can they withdraw beginning today (your 18th birthday) and each year for 4 years to spend on your education, assuming that the account now earns 7% annually?

#7 Your aunt has given you a savings bond. This savings bond will give you $100...

#7 Your aunt has given you a savings bond. This savings bond will give you $100 in 3 years. This bond has a nominal interest rate of 8%. Determine the following: What is the present value of this bond? Inflation is projected to be 3% for the next 5 years. What is the real value of that $100 face value, in today’s dollars? Compute the real interest rate of the bond. What is the difference in PV from part A,...

(show work) 2 If you deposit $1,000 now and are promised payments of $500 three years...

(show work) 2 If you deposit $1,000 now and are promised payments of $500 three years from now and $1,500 five years from now, the equation that will yield the correct rate of return is: A) -1000 = 500(P/F,i,3) + 1500(P/F,i,5) B) 0 = 1000 + 500(P/F,i,3) + 1500(P/F,i,5) C) 1000 = -500(P/F,i,3) - 1500(P/F,i,5) D) 0 = -1000 + 500(P/F,i,3) + 1500(P/F,i,5) 3 For the equation: 5,000 = 1,000(P/F,i,1) - 2,000(P/F,i,2) + 7,000(P/F,i,7) + 7,000(P/F,i,9),...

Your Aunt Sherry wanted her niece to go to college, so when her niece was born,...

Your Aunt Sherry wanted her niece to go to college, so when her niece was born, Aunt Sherry decided to invest $4,000 into an ETF that is expected to earn 11% APR. If Aunt Sherry made all the deposits, what would her niece have in the ETF when she turned 18? What amount would be available for her niece if Aunt Sherry missed one birthday payment at year 8 because she was short of funds, but made the investment on...

You want to evaluate your savings of 2.500.000 $. If you deposit your money in the...

You want to evaluate your savings of 2.500.000 $. If you deposit your money in the A bank, you get 9% interest income in every three years. The B bank provides 4% interest income per year. The B bank also provides 6% annual income to the 4-year private account and 6% annual income to the 7-year private account. Also, if you invest your money in a 4-year government bond, 7.5% interest income per year. However, the government deducts 15% tax...

You want to evaluate your savings of 1.000.000 TL. If you deposit your money in the...

You want to evaluate your savings of 1.000.000 TL. If you deposit your money in the bank, you get 10% interest income in every two years. The Bank also provides 7% annual income to the 4-year private account and 9% annual income to the 6-year private account. Also, if you invest your money in a 6-year government bond, 7.5% per year; if you invest in a 8-year municipal bond, you can get 9.5% interest income per year. However, the government...

a) Your favorite aunt opens a savings account on your name and deposits $10,000 at the...

a) Your favorite aunt opens a savings account on your name and deposits $10,000 at the end of each year for 10 years. The account earns an interest rate of 2.2%. After the final deposit, you move the accumulated savings to your brokerage account and invest in the stock market, where they earn an average return of 5.8% for the following 23 years. How much will you have in your account at the end? Round to the nearest cent. b)...

Your grandparents put $1,200 into a saving account for you when you were born 30 years...

Your grandparents put $1,200 into a saving account for you when you were born 30 years ago (on the day you were born). This account has been earning interest at a compound rate of 7%. Fill out the table below. What is its value today? Amount Interest End of year Year Deposited Earned Balance 0 1,200.00 0.00 1,200.00 1 N/A 2 N/A 3 N/A 4 N/A 5 N/A 6 N/A 7 N/A 8 N/A 9 N/A 10 N/A 11 N/A...

Your grandparents put $1,000 into a saving account for you when you were born 25 years...

Your grandparents put $1,000 into a saving account for you when you were born 25 years ago. This account has been earning interest at a compound rate of 8%. Fill out the table below. What is its value today? Amount Interest End of year Year Deposited Earned Balance 0 1,000.00 0.00 1,000.00 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 The amount...

You are at your local bank intending to deposit your savings. Explain why you would not...

You are at your local bank intending to deposit your savings. Explain why you would not offer a loan, at an interest rate that is higher than the rate the bank pays on your deposits (but lower than the rate the bank charges for car loans), to the next individual who enters the bank to apply for a car loan.

Subjects