Word Problems

1. Find the future value at each annuity due. Then determine how much cl this value is from contributions and how much is from interest. Payments of $5000 made at the beginning of each semiannual period for 9 years at 8.37% compounded semiannually 2. Find the future value of each annuity due. Then determine how much of this value is from contributions and how much is from interest. Payments ol $300 made at the beginning of each quarter for 15 years at 3.4% compounded quarterly 3. A woman deposits $8000 at the end of each year for 13 years in an amount paying 4% interest compounded annually. (3) Find the nal amount she will have on deposit. (b) Her brother-inIaw works in a bank that pays 3% compounded annually. If she deposits money in this bank instead of the other one. how much will she have in her account? (at How much would she lose over 13 years by using her brother-in-law's bank? 4. In order to accumulate enough money for a down payment on a house. a couple deposits $694 per month into an account paying 3% compounded monthly. If payments are made at the end of each period. how much money will be in the account in 7 years? 5. Starting at age 50. a woman puts $11010 at the end of each quarter into a retirement account that pays Wu interest compounded quarterly. When she reaches age 60, she withdraws the entire amount and places it in a mutual fund account that pays 9% compounded monthly. From then on she deposits $200 in the same mutual fund at the end of each month. How much is in the account when she reaches age 65? 6. Suppose a 40-year-old person deposits 5 8.000 per year in an Individual Retirement Account until age 65. Find the total in the account with the following assumption of an interest rate. [Assume ouartedy compounding. with payments of $2.000 made at the end of each quarter period.) Find the total amount 01 interest eamed. 7% 7. Michelle wants to have a $ 19.000 down payment when she buys a new car in 6 years. How much money must she deposit at the end of each quarter in an account paying 28% compounded quarterly so that she will have the down payment she desires? E. Find the present value of an ordinary annuity which has payments of $1900 per year for 13 years at 8% compounded annually. 9. Find the present value of an ordinary annuity with payments of $13,559 semiannually for 3 years at 5.2% compounded Semiannually. 10. Find the lump sum deposited today that will yield the same total amount as payments of $17,000 at the end of each year for 15 years. at an interest rate of 6% compounded annually. 11. Consider a loan of $2200 at 5% compounded quarterly. with 6 quarterly payments. Find the following. (a) the payment necessary to amortize the loan (b) the total payments and the total amount of interest paid based on the calculated quarterly payments (c) the total payments and total amount of interest paid based upon an amortization table 12. Consider a loan ct$97.000 at 6% compounded annually. with 12 annual payments. Find the following. (a) the payment necessary to amortize the loan (b) the total payments and the total amount of interest paid based on the calculated annual payments (c) the total payments and total amount of interest paid based upon an amortization table. 13. Find the monthly house payments necessary to amortize the following loan. Then calculate the total payments and the total amount of interest paid. $196,000 at 7.01% for 20 years 14. Fritz buys a car costing $11,300. He agrees to matte payments at the end ofeach monthly period tor 8 years. He pays 4.3% interest. compounded monthly. What is the amount 01' each payment? Find the total amount of interest Friu will pay