use the table above each question to answer the question. A http://lectures.mhhe
ID: 2706747 • Letter: U
Question
use the table above each question to answer the question.
A http://lectures.mhhe.com/connect/0073382426/Chapter%201/exhibit_1-a.jpg
The future value of 990, five years from now at 5 percent.
B. http://lectures.mhhe.com/connect/0073382426/Chapter%201/exhibit_1-b.jpg
The future value of 960 saved each year for 5 years at 5 percent.
C. http://lectures.mhhe.com/connect/0073382426/Chapter%201/exhibit_1-c.jpg
The amount a person would have to deposit today(present value) at a 5 percent interest rate to have 2,140 five years from now
D. http://lectures.mhhe.com/connect/0073382426/Chapter%201/exhibit_1-d.jpg
The amount a person would have to deposit today to be able to take out 1,570 a year for 5 years from an account earning 5 percent.
Explanation / Answer
A = 990*(1.05)^5 = 990*1.276 = $1263.24
B = 960*pvifa(5,5) = 960*5.526 = $5304.96
C = 2140/(1.05)^5 = 2140*.784 = $1677.76
D = 1570*pvifa(5,5)= 1570*4.329 = $6796.53
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