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Unformatted text preview: question. If so, please explain how the correct answer was obtained. Problem #3 PV = $2,000 x [1 (1.09) 20] / .09 = $18,257.09 FV = $18,257.09 x (1.09) 20 = $102,320.24 accumulated Payment = $102,320.24 / [1 (1.09) 20/ .09] = $11,208.80 annual payment Problem #5 PV of annuity = $100,000 / (1.09) 18 = $21,199.37 Annual investment = $21,199.37 / 8.756 = $2,421.12 Problem #6 $93,000 / [1 (1.09) 10/ .09] = $14,491.27 No. She can only withdraw $14,491.27 a year for the next 10 years. Problem #7 PV = $10,000 x [1 (1.10) 25] / .10 = $90,770.40 Don’t buy it. The present value is about $30,000 than its selling price. Problem #12 $65,000 (1+ i ) 5 = $100,000 i ≈ 9% Problem #13 $33,520 = $10,000 x [1 (1+ i ) 5] / i i ≈ 15%...
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This note was uploaded on 07/13/2011 for the course FIN 301 taught by Professor Crisonino during the Spring '11 term at Edison State College.
 Spring '11
 Crisonino
 Finance, Interest

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