Question
In: Finance
- If you wish to accumulate $240,000 in 13 years, how much must you deposit today...
- If you wish to accumulate $240,000 in 13 years, how much must you deposit today in an account that pays an annual interest rate of 10%? Round to the nearest $0.01.
- What will $117,000 grow to be in 18 years if it is invested in an account with an annual interest rate of 7.75%? Round to the nearest $0.01.
Solutions
Expert Solution
Ans 1) $ 69519.45
| FV = | Future Value |
| PV = | Present Value |
| r = | rate of interest |
| n= | no of period |
| PV = | FV/ (1 + r )^n |
| PV = | 240000 / ((1 + 10%)^13) |
| PV = | 69519.45 |
Ans 2) $ 448432.29
| FV = | Future Value |
| PV = | Present Value |
| r = | rate of interest |
| n= | no of period |
| FV = | PV (1 + r )^n |
| FV = | 117000*(1+7.75%)^18 |
| FV = | 448432.29 |
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