Question
In: Finance
You opened an account and deposited X Dollars on January 1, 2002 in National City Bank....
You opened an account and deposited X Dollars on January 1, 2002 in National City Bank. Any balance in the account will earn 5% per year. You withdrew $500 on January 1, 2006 and $500 on January 1, 2008. You closed out this account on January 1, 2011 and received $700. How much did you initially deposit (X) in National City at the time you opened the account?
Solutions
Expert Solution
Present value of all the future inflows will be equal to the maount deposited in the beginning
Future inflows are $ 500 in the 5th year beginning (i.e. 4years compunding) , $500 in the 7th year beginning (i.e.6 year compunding) and $ 700 in the 10th year beginning (i.e.9 year compounding)
So,
X = 500/(1.05)^4 + 500/(1.05)^6 + 700/(1.05)^9
X= 411.35 + 355.34 + 429.74
x = $1196.43
jeff jeffy answered 2 years agoRelated Solutions
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Harrison Company maintains a checking account at the First National City Bank. The bank provides a...
Harrison Company maintains a checking account at the
First National City Bank. The bank provides a bank statement along
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Balance, July 1, 2021
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Deposits
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National City Bank. The bank provides a bank statement along with
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statement included the following information:
Balance, July 1, 2018
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Deposits
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Checks processed
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bank statement included the following information:
Balance, July 1, 2021
$
56,678
Deposits
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Checks processed
(193,410
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Service charges
(70
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NSF checks
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)
Monthly payment on note, deducted directly by bank from
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Checks processed
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