a. $1,588.90 b. $1.409.90 c. $1,090.30 . $1,770.90 e. $1,503.58 would like to ac

Question

a. $1,588.90 b. $1.409.90 c. $1,090.30 . $1,770.90 e. $1,503.58 would like to accumulate $90,000 for a down payment on a she is able to save $500 at the beginning new home. of each month and these funds earn 30% per year, how long will i take her to accumalate the needed $9o,90 a 5.69 years b. 6922 years c. 68.22 years d. 5.69 months e. 8 years 18. Romero Griggs's grandmother plans on giving him $15,000 at the end of each year fos the next 5 years Assuming a discount rate of 4.5%, what is the present value of this sum? a 65,704.78 b. 66,890.89 c. 65,849.65 d. 65,079.90 e. 80,008.98 19. Unique Griffin invests $6,000 today with the hope that in 5 years her investment will be worth $9,000. The investment will compound semiannually. At the end of 5 years, what will be Unique's annual rate of return?

Explanation / Answer

Q17.

Using financial calculaotr:

Set the mode to BGN

FV=90000

PMT=-500

I/Y=30%/12=2.5%

PV=0

CPT N=68.22

hence, 68.22 months or 5.69 years

Option A

Q18.

Using financial calculaotr:

Set the mode to END

PMT=15000

I/Y=4.5%

N=5

CPT PV=65849.65

OpTion C

Q19.

Using financial calculaotr:

Set the mode to END

PV=-6000

N=5*2

FV=9000

PMT=0

CPT I/Y=4.14%

Hence, rate=4.14*2=8.28%

Option B

Q20.

-109000+200000/(1+IRR)^5+7500/(1+IRR)+8000/(1+IRR)^2+8500/(1+IRR)^3+9000/(1+IRR)^4+10000/(1+IRR)^5=0

=>IRR=19.12%

Option A

P.S.: I am allowed to solve only 4 questions

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