Using the appropriate tables, solve each of the following: Required 1. Beginning December 31, 2008, five equal

Question:

Using the appropriate tables, solve each of the following:

Required

1. Beginning December 31, 2008, five equal withdrawals are to be made. Determine the equal annual withdrawals if $30,000 is invested at 10% interest compounded annually on December 31, 2007.

2. Ten payments of $3,000 are due at annual intervals beginning June 30, 2008. What amount will be accepted in cancellation of this series of payments on June 30, 2007 assuming a discount rate of 14% compounded annually?

3. Ten payments of $2,000 are due at annual intervals beginning December 31, 2007. What amount will be accepted in cancellation of this series of payments on January 1, 2007 assuming a discount rate of 12% compounded annually?

Discount Rate
Depending upon the context, the discount rate has two different definitions and usages. First, the discount rate refers to the interest rate charged to the commercial banks and other financial institutions for the loans they take from the Federal...