Academic Integrity: tutoring, explanations, and feedback — we don’t complete graded work or submit on a student’s behalf.

1 How much do you need to invest today in order to have $11,986 at the end of 15

ID: 2684548 • Letter: 1

Question

1 How much do you need to invest today in order to have $11,986 at the end of 15 yrs if you are sure to earn an interest at the rate of 12% 2 How many yrs it will take you to quadruple your money if you can earn 1395% each year 3 What is the FV of $2,764 invested for 11 yrs at 13% if interest is compounded quarterly 4 Assume interest rate of 9% A company receives cash flows of $79,882 at the end of yrs 4, 5, 6, 7, and 8, and cash flows of $200,820 at the end of year 10 5 How much do you need to invest today in order to have $3,395 at the end of 16 yrs if you are sure to earn an interest at the rate of 14%, if interest is compounded quarterly 6 Assume interest rate of 9% Suppose that you receive $94,452 at the end of each year for 4 yrs Suppose that this cash flow starts at the end of the fourth year Compute the PV

Explanation / Answer

1 How much do you need to invest today in order to have $11,986 at the end of 15 yrs if you are sure to earn an interest at the rate of 12%

1. $2,189.80

2 How many yrs it will take you to quadruple your money if you can earn 1395% each year

. 10.62 years

3 What is the FV of $2,764 invested for 11 yrs at 13% if interest is compounded quarterly

$11,290.18

4 Assume interest rate of 9% A company receives cash flows of $79,882 at the end of yrs 4, 5, 6, 7, and 8, and cash flows of $200,820 at the end of year 10

$768,815.74

5 How much do you need to invest today in order to have $3,395 at the end of 16 yrs if you are sure to earn an interest at the rate of 14%, if interest is compounded quarterly

$375.54

6 Assume interest rate of 9% Suppose that you receive $94,452 at the end of each year for 4 yrs Suppose that this cash flow starts at the end of the fourth year Compute the PV

$236,286.62