1). How much will $6000 be worth if it is invested at 3.5% interest for 20 years compounded annually, semi-annually, quarterly, monthly, weekly, daily? (Use Excel dropdown)

2). How much should be invested now at 4% per annum so that after 2 years the amount will be $10000 when the interest is compounded annually, quarterly, monthly, daily?(Use Excel dropdown).

3). If you want your $25000 to double in 25 years (when you retire early), at what approximate rate of compound interest should you find for your investment?

(For #4-5): Start with a principal (present value) of $10000.Which rate would yield a larger amount after 1 year? :

4). 6% compounded quarterly or 6.25% compounded annually?

5). 9% compounded monthly or 8.8% compounded daily?

6). What will a $190,000 condo cost 5 years from now if the price appreciation for this apartment over that period averages 3% compounded annually?

7). A department store charges 1.25% per month on the unpaid balances for customers with charge accounts (interest is compounded monthly). A customer charges $1200 and does not pay her bill for 6 months.What is the bill at that time?

8). Jason puts $5000 into a Roth IRA that pays 4% interest compounded annually. How much will the investment be worth after 30 years?

9). Suppose Jason waited 10 years to invest his money.How much will that $5000 at 4% compounded annually be worth after just 20 years?

10). One more Excel dropdown problem: Invest $7500 for 25 years at 4.5% interest compounded annually, semi-annually, quarterly, monthly, and daily. (You will still be young - enjoy it!) Comment on your findings.

 

Answer rating: 100% (QA)

1 To calculate the future value of an investment we can use the formula Future Value Principal 1 Interest Rate nn Time where Principal is the initial investment amount Interest Rate is the annual inte... View the full answer