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Unformatted text preview: 4. You own a classic automobile that is currently valued at $67,900. If the value increases by 8 percent annually, how much will the automobile be worth 15 years from now? a. $199,801.33 b. $212,524.67 c. $214,740.01 D . $215,390.28 e. $218,887.79 Future value = $67,900 (1 + .08) 15 = $215,390.28 5. You would like to give your daughter $50,000 towards her college education 15 years from now. How much money must you set aside today for this purpose if you can earn 9 percent on your investments? a. $12,250.00 b. $12,989.47 C . $13,726.90 d. $14,008.50 e. $14,211.11 Present value = $50,000 [1 / (1 + .09) 15 ] = $13,726.90...
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 Fall '10
 FANG
 Finance, Compounding, Interest

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