Time Value Assignment Fall 2019 1. Assume that this year, the average wedding cost $25,000. Assuming 4% inflation, what will it cost in 30 years? 2. At what rate must money be invested to double the money over a 10 year time frame? 3. Suppose you need $10,000 in two years for the down payment on a new car. If you can earn 7% annually, how much do you need to invest today? 4. You want to begin saving for your daughter's college education and you estimate that she will need $150,000 in 17 years. If you feel confident that you can earn 8% compounded semiannually, how much do you need to invest today? 5. You are considering an investment that will pay you $1,000 in one year, $2,000 in two years and $3,000 in three years. If you want to earn 10% on your money, how much would you be willing to pay? 6. What is the present value of the 25 annual payments of $50,000 offered to the soon-to-be ex-spouse, assuming a 5% discount rate? 7. Assuming $2000 annual contributions with 9% return, how much will an Individual Retirement Account (RA) be worth in 30 years? 8. Suppose you begin saving for your retirement by depositing $2,000 per year in an IRA starting at the end of the year. If the interest rate is 7.5%, how much will you have in 40 years? 9. You are saving for a new house and you put $10,000 per year in an account paying 8%. The first payment is made today. How much will you have at the end of 3 years? 10. You are renting a storage warehouse for 6 years. The rent is $6,000 per year payable at the beginning of each year. You want to set aside the money necessary to meet these payments. If the money you deposit in the payment account earns 9% compounded annually, how much do you have to deposit in the account