Quiz1_B(Answers)

Quiz1_B(Answers) - BADM 115 – Section 11 Prof. Isabelle...

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Unformatted text preview: BADM 115 – Section 11 Prof. Isabelle Bajeux‐Besnainou Fall 2008 Form B QUIZ #1 1. List 3 disadvantages of a corporation Double taxation of earnings, less easy and more expensive to form, cost of report filing, more government regulations 2. If you deposit money today in an account that pays 5.5 percent annual interest, how long will it take to double your money? I/YR 5.50% PV ‐1 FV 2 PV 0 Solve for the number of periods N 12.95 3. Find the future values of these ordinary annuities. Compounding occurs once a year. a. $600 per year for 8 years at 11 percent PMT ‐600 N 8 I/YR 11% Solve for future value FV $7,115.66 b. $300 per year for 4 years at 5.5 percent PMT ‐300 N 4 I/YR 6% Solve for future value FV $1,302.68 c. $600 per year for 4 years at 0 percent PMT ‐600 N 4 I/YR 0% Solve for future value FV $2,400.00 B ‐ 1 d. Rework parts a, b, and c assuming that they are annuities due Repeat the procedures discussed in parts a, b, and c, but first switch the calculator to “BEG” mode a) PMT ‐600 N 8 I/YR 11% Solve for future value FV $7,898.38 b) PMT ‐300 N 4 I/YR 6% Solve for future value FV $1,374.33 c) PMT ‐600 N 4 I/YR 0% Solve for future value FV $2,400.00 B ‐ 2 ...
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This note was uploaded on 01/02/2010 for the course BADM 115 taught by Professor Bajeux during the Fall '08 term at GWU.

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