# Question: Then answer the following questions 1 You deposit 10 000 How

Then answer the following questions:

1. You deposit $10,000. How much will you have in 4 years at

(a) 8% compounded annually, and

(b) At 12% compounded annually?

2. A savings and loan association offers depositors a $10,000 lump-sum payment 4 years hence.

(a) How much will you be willing to deposit if you desire an interest rate of 8% compounded annually?

(b) How much at an interest rate of 12%?

3. Repeat requirement 2, assuming an interest rates of 6% and do the calculation twice, assuming

(a) Annual and then

(b) Semiannual compounding.

1. You deposit $10,000. How much will you have in 4 years at

(a) 8% compounded annually, and

(b) At 12% compounded annually?

2. A savings and loan association offers depositors a $10,000 lump-sum payment 4 years hence.

(a) How much will you be willing to deposit if you desire an interest rate of 8% compounded annually?

(b) How much at an interest rate of 12%?

3. Repeat requirement 2, assuming an interest rates of 6% and do the calculation twice, assuming

(a) Annual and then

(b) Semiannual compounding.

**View Solution:**## Answer to relevant Questions

A reliable friend has asked you for a loan. You are pondering various proposals for repayment. 1. Repayment of a $30,000 lump sum 4 years hence. How much will you lend if your desired rate of return is (a) 10% compounded ...For the week ended January 27, the Massengill Company had a total payroll of $100,000. The company withheld three items from employees’ paychecks: (1) Social Security (FICA) tax of 7.1% of the payroll; (2) income taxes, ...On January 1, 20X0, Washington Park District issued $20 million of 5-year, 6% debentures. Interest is paid semiannually. The market interest rate at issuance was 10%. 1. Compute the proceeds from issuing the debentures. 2. ...On January 2, a local bookstore borrowed from a bank on a 1-year note. The face value of the note was $80,000. However, the bank deducted its interest “in advance” at 5% of the face value. Show the effects on the ...According to note 15 in its 10-K, Boeing Company, the aircraft and aerospace manufacturer, had pension obligations of $67,651 million and obligations for postretirement benefits other than pensions of $7,997 million at the ...Post your question