unit 1personal finance concepts

unit 1personal finance concepts - FIN110-1004A-15 Personal...

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FIN110-1004A-15 Personal Finance Concepts Assignment Name: Unit 1 Individual Project Deliverable Length: 3-4 paragraphs Details: Please answer these questions: A. After a protracted legal case, Joe won a settlement that will pay him $11,000 each year at the end of the year for the next ten years. If the market interest rates are currently 5%, exactly how much should the court invest today, assuming end of year payments, so there will be nothing left in the account after the final payment is made? Present Value (PV) = Amount * [(1+r)^(n) - 1]/r where the AMOUNT is the annual amount invested each year, 'n' is the number of years and 'r' is the annual rate of the investment. = 11,000 [(1+.05)^(10) – 1]/.05 = $138,357 B. Mary just deposited $33,000 in an account paying 7% interest. She plans to leave the money in this account for eight years. How much will she have in the account at the end of the seventh year? Future Value = Present Value * [
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This note was uploaded on 12/25/2010 for the course DEPTT. 2339485 taught by Professor J.khowel during the Spring '10 term at twsu.edu.

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unit 1personal finance concepts - FIN110-1004A-15 Personal...

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