Suppose $10,000 suddenly falls out of the sky and into your lap. Rather than spend it,...
Fantastic news! We've Found the answer you've been seeking!
Question:
Transcribed Image Text:
Suppose $10,000 suddenly falls out of the sky and into your lap. Rather than spend it, you wisely invest it in an asset that pays an interest rate of 8% per year (compounded annually). At the end of 40 years, how much has this $10,000 grown to? How much of it is simple interest and how much of it is compound interest? Suppose $10,000 suddenly falls out of the sky and into your lap. Rather than spend it, you wisely invest it in an asset that pays an interest rate of 8% per year (compounded annually). At the end of 40 years, how much has this $10,000 grown to? How much of it is simple interest and how much of it is compound interest?
Expert Answer:
Answer rating: 100% (QA)
To calculate the future value of the investment after 40 years we can use the compound interest form... View the full answer
Related Book For
Posted Date:
Students also viewed these finance questions

EBIT is 22.000, taxes 34%, depreciation is 30.000. What is the operating cash flow? Anthony operates a part time auto repair service. He estimates that a new diagnostic computer system will result...

What is the main determinant of capital structure? Explain using examples from your readings or from current events.

Q4 11 Points 4. Consider the following Current Data for ABC Corp.: Debt Equity Market Value (in millions of $) 16,000 26,000 Cost 7% 14% If ABC moves to and maintains a debttovalue (D/V) ratio of...

Michael Ingolby opened his first The Outdoor Enthusiast sporting goods store in Calgary in 1999. The store was very successful, and Michael realized he had tapped into a market that had long been...

A voltaic cell is constructed with two silversilver chloride electrodes, each of which is based on the following halfreaction: AgCl(s) + e Ag(s) + Cl (aq) The two halfcells have [CI] = 0.0150 M...

Which of the following statements is an advantage of classical variables sampling? a. If no errors are expected, classical variables sampling will result in a smaller sample size than...

Debbie Dean issued a check to Betty Brown payable to the order of Cathy Cain and Betty Brown. Betty indorsed the check Payable to Elizabeth East, (signed) Betty Brown. What rights, if any, does...

For the following function, list the intervals where f(x) is concave up and where it is concave down. Find any points of inflection. Do NOT use a graph to answer the question. f(x)=3x+2x12x+5

Make a StackIterator class in java because we already havedocument driver and output.txtpackage iterator;import java.util.Scanner;public class DocumentDriver {private Scanner scanner;private Doc 1...

How much pollution would exist if all externalities were internalized? Why would it not be zero? Use the same explanation to discuss the amount of health and safety that the government should require...

You need to design a square toroid such that the magnetic field in the centre of the square windings is \(0.0020 \mathrm{~T}\), and the side length of a square winding is \(3 \mathrm{~cm}\). The wire...

Smokers impose negative externalities on nonsmokers. Suppose the air in a restaurant is a resource owned by the restaurant owner. a. How would the owner respond to the negative externalities of...

Water, initially at \(25^{\circ} \mathrm{C}\), is slowly flowing through a \(1 \mathrm{~cm}\) diameter tube whose wall temperature remains constant at \(10^{\circ} \mathrm{C}\). The water velocity...

The entry length problem discussed in Section 13.5.1 can be analyzed using the boundary layer equations for a flat plate. The only caveat is that the thermal boundary layer must be small compared to...

Capacitively coupled multistage amplifiers are having better low frequency response than direct coupled multistage amplifiers. Select one: True False

Coastal Refining Company operates a refinery with a distillation capacity of 12,000 barrels per day. As a new member of Coastal's management team, you have been given the task of developing a...

Imagine that you own a bagel shop, which you visit once a day. According to company policy, employees are supposed to pay for all the bagels they eat. Why is moral hazard likely to be a problem in...

For each point on the PPF in Figure 2P3, note whether the point is attainable and efficient, attainable and inefficient, or unattainable.

Is it possible that even though men make more than women in a particular industry, there could be gender discrimination against men in that industry? If no, explain why not. If yes, explain why and...

At a given point on the airfoil surface with very low speeds, the pressure coefficient is 0.3. If the Mach number of the free stream is 0.6, then CP calculated at this point is?

A two dimensional airfoil is placed in the air so that its lowest pressure point appears on the lower surface. The pressure coefficient at this point is 0.782 when far field Mach number is 0.3. Try...

At low speed Incompressible flow, the pressure coefficient at a given point on the wing is 0.54. When the free flow Mach number is 0.58, by use of (1) PrandtlGlauert law (2) KarmanQian law (3)...
Study smarter with the SolutionInn App