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# HW3 - Years Interest Rate Future Value 221 6 5.6 307 425 7...

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Brineydi Peralta Chapter 4: Critical Thinking 4.8 Problems 1, 2, 4, 6 Chapter 5: Problem 2,3,4 and 20 4.8 If there isn’t another bank that has a higher rate than this one. And no I don’t think it would change on who is making the promise to repay because it is my investment. 1. First City Bank (1+.08^10)=1.08^10=2.1589 6,000*1.08^10 = 12,953.55=12,954 Second City Bank # of Years Calculations 1 6,000*(1+.10)=6,600 2 6,600*(1.10)=7,260 3 7,260*(1.10)=7,986 4 7,986*(1.10)=8,784.6 5 8,784.6*(1.10)=9,663.06 6 9,663.06*(1.10)=10,629.30 7 10,629.30*(1.10)=11,692.30 8 11,692.30*(1.10)=12,861.53 9 12,861.53*(1.10)=14,147.69 10 14,147.69*(1.10)=15,562.45 15,562.45-12,954=2,608.45 more 2. Present value Years Interest Rate Future Value 3,150 5 18% 7,206.44 8,453 10 6% 15,143.41 89,305 17 11% 526,461.25 227,382 20 5% 603,312.12

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4. Present Value
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Unformatted text preview: Years Interest Rate Future Value 221 6 5.6% 307 425 7 8% 905 25,000 18 10% 143,625 40,200 21 9% 255,810 6. 290,000/35,000= 8.2857 8.2857^(1/18)=1.12=12% 7. 1,300/.50=2,600 2,600^(1/102)=1.08= 8% Chapter 5 2. Discount Rate 6 % X: 5,500*6.8017=37,409.31 Y: 8,000*4.2123=33,698.91 Discount Rate 22% X: 5,500*3.7862= 20,824.57 Y: 8,000*2.8636= 22,909.12 3. Year 4 cash f low 2,000 @8% FV= 9,012.22 At 11% Years Future Value 1 700 2 1,899 3 4,678.94 4 9,419.46 At 24% Years Future value 1 700 2 2,016 3 5,288.64 4 11,368.45 4. 7,000(1-1/1.09^15)/.09= 56,424.82 Value of the investment 7,000(1-1/1.09^40)/.09=75,301.52 7,000(1-1/1.09^75)/.09=77,656.47 20. 17,682.86 yearly/12=1,473.57 monthly An effective annual rate depends on individuals income....
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HW3 - Years Interest Rate Future Value 221 6 5.6 307 425 7...

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