Use an Excel spreadsheet and the FV function to determine the following a The future value of a $2,000 annuity for 30 years at 8 compounded annually b The future value of a $2,000 annuity for 30 years at 8 compounded semiannually c The future value of a $2,000 annuity for 30 years at 8 compounded q...

a 226566 FV008 30 2000 b 237991 FV004 60 1000 c 244129 FV002 1 ...

Use an Excel spreadsheet and the FV function to determine the following: a. The future value of

Question:

Use an Excel spreadsheet and the FV function to determine the following:
a. The of a $2,000 for 30 years at 8% compounded annually.
b. The of a $2,000 for 30 years at 8% compounded semiannually.
c. The of a $2,000 for 30 years at 8% compounded quarterly.
d. How much extra interest is earned on the above simply by changing the period from annually to quarterly?
e. How much extra interest would be earned by changing from annual to daily Louisa set up an individual retirement account (IRA account) on her 35th birthday.
She contributed $2,000 to the account on each subsequent birthday through her 65th.
The account earned 8% compounded annually. What amount of interest (in dollars) will she have earned on this investment?
g. Suppose she had started the IRA account 10 years earlier when she was 25 years old.
How much additional interest would she have earned on this investment by age 65?

Annuity
An annuity is a series of equal payment made at equal intervals during a period of time. In other words annuity is a contract between insurer and insurance company in which insurer make a lump-sum payment or a series of payment and, in return,... Compounding
Compounding is the process in which an asset's earnings, from either capital gains or interest, are reinvested to generate additional earnings over time. This growth, calculated using exponential functions, occurs because the investment will... Future Value
Future value (FV) is the value of a current asset at a future date based on an assumed rate of growth. The future value (FV) is important to investors and financial planners as they use it to estimate how much an investment made today will be worth...