The stock market has an average annual return of 10% per year. We will consider the...

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The stock market has an average annual return of 10% per year. We will consider the annual return to be an annual interest rate (a) Suppose the stock market for the next 10 years has a weak growth rate. If you invested your $1400 stimulus check in the stock market with 6% annual interest, compounded annually, how much money would you have after 10 years? (b) Now suppose the stock market for the next 10 years has a strong growth rate. If you invested your $1400 stimulus check in the stock market with 16% annual interest, compounded annually, how much money would you have after 10 years? Perhaps you want to buy a house in 20 years. The average home in San Jose cost $1.2 million this year You will need to put a down payment of 15% to buy a house at this price (a down payment is a proportion of the price of the house you pay upfront, in this case 15% of $1.2 million). Assuming 10% annual interest, compounded yearly, how much would you need to invest now to pay for this down payment in 20 years? Suppose instead you want to put a 15% down payment on a $500,000 house in Texas. If you get a $6000 signing bonus from your first post-college job, how long would it take for you to pay for the down payment on this house using your signing bonus (assuming 10% annual interest compounded annually)? The stock market has an average annual return of 10% per year. We will consider the annual return to be an annual interest rate (a) Suppose the stock market for the next 10 years has a weak growth rate. If you invested your $1400 stimulus check in the stock market with 6% annual interest, compounded annually, how much money would you have after 10 years? (b) Now suppose the stock market for the next 10 years has a strong growth rate. If you invested your $1400 stimulus check in the stock market with 16% annual interest, compounded annually, how much money would you have after 10 years? Perhaps you want to buy a house in 20 years. The average home in San Jose cost $1.2 million this year You will need to put a down payment of 15% to buy a house at this price (a down payment is a proportion of the price of the house you pay upfront, in this case 15% of $1.2 million). Assuming 10% annual interest, compounded yearly, how much would you need to invest now to pay for this down payment in 20 years? Suppose instead you want to put a 15% down payment on a $500,000 house in Texas. If you get a $6000 signing bonus from your first post-college job, how long would it take for you to pay for the down payment on this house using your signing bonus (assuming 10% annual interest compounded annually)?

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