Magui is planning to invest an amount of money in a certificate of deposit at her bank.
Question:
Magui is planning to invest an amount of money in a certificate of deposit at her bank. The stated interest rate applied to the certificate of deposit is 12%, compounded monthly. What amount should Magui invest if she wants the balance in the certificate of deposit account to grow to $8,500 in 2½ years?
2. How much will be the future value of a 5-year ordinary annuity which has annual payments of $200, evaluated at a 7.5% semi-annual interest rate?
3. If $100 is placed in an account that has a required rate of return of 4%, compounded quarterly, how much will it be worth after five years?
4. If May needs $350,000 for a down payment on a lot in 3 years, how much money should she invest today at 8% interest, compounded quarterly, to achieve her goal?
5. Lav inherited $150,000 from her grandmother. She decided to invest the money in a three-year Certificate of Deposit that pays interest of 4%, compounding quarterly, to use as a payment for her tuition fee. What amount will Lave have when the Certificate of Deposit matures?
Corporate Finance A Focused Approach
ISBN: 978-1305637108
6th edition
Authors: Michael C. Ehrhardt, Eugene F. Brigham