QUESTION 14

PART A

PART B

PART C

PART D

(Related to Checkpoint 5.5) (Solving for n) Jack asked Jill to marry him, and she has accepted under one condition: Jack must buy her a new $320,000 Rolls-Royce Phantom. Jack currently has $17,090 that he may invest. He has found a mutual fund with an expected annual return of 7 percent in which he will place the money. How long will it take Jack to win Jill's hand in marriage? Ignore taxes and inflation. D The number of years it will take for Jack to win Jill's hand in marriage is years. (Round to one decimal place.) (Related to Checkpoint 5.6) (Solving for i) You lend a friend $10,000, for which your friend will repay you $27,027 at the end of 5 years. What interest rate are you charging your "friend"? ... The interest rate you are charging your friend on the loan is % (Round to the nearest whole percent.) (Related to Checkpoint 5.4) (Present-value comparison) You are offered $120,000 today or $320,000 in 14 years. Assuming that you can earn 14 percent on your money, which should you choose? .. If you are offered $320,000 in 14 years and you can earn 14 percent on your money, what is the present value of $320,000? $(Round to the nearest cent.) (Related to Checkpoint 5.4) (Present-value comparison) You are offered $100,000 today or $300,000 in 13 years. Assuming that you can earn 11 percent on your money, which should you choose? .. If you are offered $300,000 in 13 years and you can earn 11 percent on your money, what is the present value of $300,000? (Round to the nearest cent.)