1. Shelly' is examining an opportunity to invest $25,000 today to get a return of $40,000 in

the future. If the investment grows at 12% annually, how long must shelly wait to get the

future return?

2. A newly married couple at present has $100,000, they plan to buy a house for $500,000

after 10 years by depositing the savings in a bank account. What must be the rate of

return on the savings account to get the desired return?

3. Jenning, plans to buy a plot of land for $50,000 , after 5 years. He decides to deposit

equal amount of savings in the bank each year to buy the plot of a land. If the deposit is

expected to increase by 12 percent per year, how much will be the annuity deposits to be

made by Jenning?

4. Kye will receive $175,000 investment return in 15 years. If the funds are discounted back

at a rate of 14 percent, what is the present value of his future return?

5. Terry takes a study loan of $10,000 today, to be repaid in equal annual instalments in 5

years. The bank will charge Terry 10% interest per annum What will be the annuity to

be paid by Lury?

6. Saina is given an opportunity to invest $10,000 today to get a return of 12 percent,

compounded semiannually. How much will be the future return on this investment?

7. Determine the amount of money in a savings account at the end of 10 years, given an

initial deposit of $5,500 and a 12 percent annual interest rate when interest is

compounded (a) annually, (b) semiannually, and (c) quarterly.

8. Mohammed plans to take an insurance by paying a premium of $ 10,000 every year at the

end of the next 15 years. If the insurance funds earns 10% interest. Find the present

value of the insurance policy?

Answer rating: 100% (QA)

Shellys Investment Formula Future Value FV Present Value PV 1 Interest RateNumber of Periods Rearran... View the full answer