3) $900 is received at the beginning of yearl, 800 is received at the beginning of...

Question

Question

business finance

Answer 1

Answer #1

3]

future value = present value * (1 + rate of return)^{number
of years}

The $900 is invested for 4 years

The $800 is invested for 2 years

The $400 is invested for 1 year

Combined future value = ($900 * (1 + 12%)⁴) + ($800 * (1 + 12%)²) + ($400 * (1 + 12%)¹)

Combined future value = $2,867.69

Answer 2

Similar Homework Help Questions

$100 is received at the beginning of year 1, $200 is received at the beginning of...

$100 is received at the beginning of year 1, $200 is received at the beginning of year 2, and $300 is received at the beginning of year 3. If these cash flows are deposited at 12 percent, their combined future value at the end of year 3 is ________.
2) You have received a 3-year $10,000 loan from your bank. This is an amortized loan...

2) You have received a 3-year $10,000 loan from your bank. This is an amortized loan which means you have to make 3 equal annual payments to the bank. The bank is charging you 12% APR (annual percentage rate) for this loan. a. Complete the following amortization schedule. (25 points) Amortization schedule Beginning Balance Annual Payment Interest Balance Reduction year End Balance Expense $10,000 $0.00 How much in total you end up paying back to the bank? (5 points) Assume...
ABC plans to make equal payments into a fund on 1/1 of each year, beginning on...

ABC plans to make equal payments into a fund on 1/1 of each year, beginning on 1/1/A with the final payment on 1/1/D, to pay the principal (only) of serial bonds maturing $50,000 on 12/31/C and $50,000 on 12/31/D. How much must be deposited annually if the fund earns 10%? Show work. Ans: $20,568 annually

. On the day Saffron was born, her parents put $800 into an investment account that...

. On the day Saffron was born, her parents put $800 into an investment account that promises to pay a fixed interest rate of 7 percent per year. How much money will she have in this account when she turns 18? Round to two decimal places. 2. At what rate must $311.25 be compounded annually for it to grow to $612.28 in 10 years? Submit your answer as a percentage and round to two decimal places. How much money must...
You are thinking of purchasing a house. The house costs $350,000. You have $50,000 in cash...

You are thinking of purchasing a house. The house costs $350,000. You have $50,000 in cash that you can use as a down payment on the house, but you need to borrow the rest of the purchase price. The bank is offering a 30-year mortgage that requires annual payments and has an interest rate of 7% per year. You can afford to pay only $23,500 per year. The bank agrees to allow you to pay this amount each year, yet...
ABC plans to make equal payments into a fund on 1/1 of each year, beginning on...

ABC plans to make equal payments into a fund on 1/1 of each year, beginning on 1/1/A with the final payment on 1/1/D, to pay the principal (only) of serial bonds maturing $50,000 on 12/31/C and $50,000 on 12/31/D. How much must be deposited annually if the fund earns 10%? Show work. Ans: $20,568 annually Please explain how to solve using FINANCIAL CALCULATOR

You would like to buy a house that costs $350,000. You have $50,000 in cash that...

You would like to buy a house that costs $350,000. You have $50,000 in cash that you can put down on the house, but you need to borrow the rest of the purchase price. The bank is offering you a 30-year mortgage that requires annual payments and has an interest rate of 10% per year. You can afford to pay only $31,190 per year. The bank agrees to allow you to pay this amount each year, yet still borrow $300,000....
What is the present value of $800 payments received at the beginning of each year for...

What is the present value of $800 payments received at the beginning of each year for the next 7 years? Assume an interest rate of 10% APR.
You would like to buy a house that costs $350,000. You have $50,000 in cash that...

You would like to buy a house that costs $350,000. You have $50,000 in cash that you can put down on the house, but you need to borrow the rest of the purchase price. The bank is offering you a 30-year mortgage that requires annual payments and has an interest rate of 8% per year. You can afford to pay only $25,580 per year. The bank agrees to allow you to pay this amount each year, yet still borrow $300,000....

12. You anticipate a cash flow of $900 at the end of year 1, $600 at...

12. You anticipate a cash flow of $900 at the end of year 1, $600 at the end of year 2, and $800 at the end of year 4. What is the annual equivalent of the cash flow for years 1 through 4? In other words, what constant value “A” could you receive at the end of years 1-4 such that the two cash series of flows are economically equivalent? The interest rate is 6% annual compounded annually.