Multiple Choice: Select the best answer and place it on the line next to the question number.
1.) Bud Lime has $368,882 accumulated in a 401K plan. The fund is earning a low, but safe, 3% per year. Bud Lime plans to take annual withdrawals starting today. Assuming each withdrawal is for $30,000; how many payments will Bud Lime receive before the fund is depleted?
2.) Micro Brewery borrows $300,000 to be repaid in three years. The loan is to be repaid with six semiannual payments and the first payment due in six months. The annual interest rate on the loan is 6%. The amount of each payment is?
3.) Tecate wants to invest money in a 6% certificate of deposit that compounds interest semiannually. Tecate would like the account to have a balance of $50,000 five years from now. How much must Tecate deposit now to accomplish their goal?
4.) At the end of each quarter, Sol deposits $500 into an account that pays an annual interest rate of 12% with interest compounded quarterly. How much will Sol have in the account in three years?
Answer 1) A) 15... View the full answer