E120_SUM11_HW1

E120_SUM11_HW1 - E120 Homework 1 Due 07/01/2010 Problem 1:...

Info iconThis preview shows pages 1–3. Sign up to view the full content.

View Full Document Right Arrow Icon
E120 Homework 1 Due 07/01/2010 Problem 1: Calculate the future value of $2000 in 1. 5 years at an interest rate of 5% per year. 2. 10 years at an interest rate of 5% per year. 3. 5 years at an interest rate of 10% per year. 4. Why is the amount of interest earned in part (a) less than half the amount of interest earned in part (b)? Problem 2: What is the present value of $10,000 received 1. 12 years from today when the interest rate is 4% per year? 2. 20 years from today when the interest rate is 8% per year? 3. 6 years from today when the interest rate is 2% per year? Problem 3: Your brother has offered to give you either $5000 today or $10,000 in ten years. If the interest rate is 7% per year, which option is preferable?
Background image of page 1

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
Problem 4: Your grandfather put some money in an account for you on the day you were born. You are now 18 years old and are allowed to withdraw the money for the first time. The account currently has $3996 in it and pays an 8% interest rate. 1. How much money would be in the account if you left the money there until your
Background image of page 2
Image of page 3
This is the end of the preview. Sign up to access the rest of the document.

This note was uploaded on 08/15/2011 for the course ENGR 120 taught by Professor Alder during the Summer '11 term at Berkeley.

Page1 / 3

E120_SUM11_HW1 - E120 Homework 1 Due 07/01/2010 Problem 1:...

This preview shows document pages 1 - 3. Sign up to view the full document.

View Full Document Right Arrow Icon
Ask a homework question - tutors are online