1- If you deposit money today in an account that pays 15% annual interest, how long will...
Question:
1- If you deposit money today in an account that pays 15% annual interest, how long will it take to double your money?
2-You have $19,034.61 in a brokerage account, and you plan to deposit an additional $3,000 at the end of every future year until your account totals $210,000. You expect to earn 13% annually on the account. How many years will it take to reach your goal? Round your answer to the nearest whole number.
3- What is the present value of a $300 perpetuity if the interest rate is 3%? If interest rates doubled to 6%, what would its present value be? Round your answers to the nearest cent.
4- You have saved $5,000 for a down payment on a new car. The largest monthly payment you can afford is $500. The loan will have a 6% APR based on end-of-month payments. What is the most expensive car you can afford if you finance it for 48 months? For 60 months? Do not round intermediate calculations. Round your answers to the nearest cent.
Corporate Finance A Focused Approach
ISBN: 978-1439078082
4th Edition
Authors: Michael C. Ehrhardt, Eugene F. Brigham