1. Future Value Bill O\'Brien would like to take his wife, Mary, on a trip four

Question

1. Future Value Bill O'Brien would like to take his wife, Mary, on a trip four years from now to Europe to celebrate their 40th anniversary. He has just received a $19000 inheritance from an uncle and intends to invest it for the trip. Bill estimates the trip will cost $23700 and he believes he can earn 5% interest, compounded annually, on his investment. What amount will he have after four years? Assume that the trip will cost $25300. What interest rate, compounded annually, must Bill earn to accumulate enough to pay for the trip? Bill's total in 4 years Interest rate needed to meet new cost (in %) 2. Annuity Payments Don James purchased a new automobile for $24000. Don made a cash down payment of $6000 and agreed to pay the remaining balance in 48 monthly installments, beginning one month from the date of purchase Financing is available at a 12% annual interest rate·Required:Calculate the amount of the required monthly payment. Payment amounts

Explanation / Answer

Since there were no details of the question to be solved.I have solved 3rd sum for you.

Year 2013 2014 2015 2017 2019 Payments 4,100 5,300 7,300 9,900 Discount rate 4% PV factor 0.961 0.925 0.889 0.822 0.76 Present value 3792.5 4711.7 6000.6 7524 22028.8

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