User Account

All Pages

Calculating effective annual interest rate

Assignment Help Business Management
Reference no: EM133031263

Jenny decided to do the following things after completion of her finance degree at Holmes Institute:

  1. Putting an exact amount of money in to Smart Investment Fund at the beginning of each year to have a saving of $800,000 for her retirement in 25 years from now. The average rate of return provided by this investment fund is 11% per year. 
  2.  Having solar panels installed on her house roof for saving monthly electricity expense.
  3. Saving extra monthly income in to a bank account that allows flexibility when she needs cash and at the same time provides interest income for any existing balance.

Required:

  1. How much money should Jenny put into her investment fund account at the begining of each year to reach her saving target in 25 years from now?
  2. The solar panel provider offers her a payment package of $100/month at the end of each month for 3 years. Given the interest rate is 3.5%, calculate the present value of the payment package?
  3. Jenny is considering offers from two banks for her saving account. Bank A offers the interest rate of 2.54% per year, compounding semi-annualy. Bank B offers the interest rate of 2.53% per year, compounding daily. Help Jenny choose the better Bank by calculating Effective Annual Interest Rate (EAR).

Reference no: EM133031263

Questions Cloud

Syndexa and technology transfer at harvard : What are the final negotiations that were agreed on by all parties, from the Syndexa and Technology Transfer at Harvard?
Construct a formula to calculate the percent : Construct a formula to calculate the percent that the Texas Total is of Total Sales, and then apply Percent Style. Fill the formula down through the range G5:G8
ACCT 225 - Managerial Accounting Assignment : ACCT 225 - Managerial Accounting Assignment Help and Solution - Franklin University, USA - Homework Help - Prepare an income statement
Describe the values of projects management : Describe the values of projects management in a fashion business and discuss the effects PM will have in the future of fashion industry
Calculating effective annual interest rate : Jenny decided to do the following things after completion of her finance degree at Holmes Institute:
Provide a projected cash-flow statement : Provide a projected cash-flow statement fitting your recommendations (balance sheet not required) for the 1st year
Establish criteria for seeking appropriate sources : Is the effective selection of comparative data and information requires you to determine needs and priorities and establish criteria for seeking appropriate sou
Social mobility toward establishing global business : What is the Importance of understanding social stratification and social mobility toward establishing global business?
How is canada culture different than home country : How is Canada's culture different than your home country(India)? How do these changes apply to business?

Reviews

Write a Review

Business Management Questions & Answers

  What types of revenue streams

What types of revenue streams can you apply to your business? Why did you choose these models for revenue?

  Performing a physical examination on a patient

Many individuals analyze financial statements to make logical and appropriate decisionsabout a company's financial health and well being. This process is somewhat similar to a medical doctor performing a physical examination on a patient.

  Employees to learn key risk areas

How can management work with employees to learn key risk areas?

  What are the ethical issues in this case

What are the ethical issues in this case? What are some reasons the decision maker in this case might be inclined to go along? Not go along

  Hazardous material leak has occurred in a school building

Hazardous material leak has occurred in a school building. There are numerous signs on the door, one in particular is a DOT placard of 3318 on the door.

  Which product should h55 push to customers

Beer has a 27 percent contribution margin and wine has a 25 percent contribution margin. If other factors are equal, which product should H55 push to customers?

  What does quality mean to you

What does quality mean to you? How does good (or bad) quality affect you personally as a consumer?

  Concept of portfolio management

Evaluate how the core principles of finance and the concept of portfolio management can improve profitability and give a competitive edge

  Facilitate small batch sizes and continuous flow production

Which of the following is a manufacturing approach in which equipment and workstations are arranged in a bounded area to facilitate small batch sizes and contin

  Determining the disciplinary action

How does an arbitrator determine that a company had just cause for taking a disciplinary action? What remedy might an arbitrator choose if a company did not have just cause? Will the process be different if the organization does not have union rep..

  What is the source of english law

1. Duties of the parliament include all except

  Global strategic management

Implementation: Describe the implementation of the strategy you recommended and evaluation and Control: How do you evaluate the performance of your implemented strategy

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

Submit Assignment

Academics

Major Subjects

Majors

Get In Touch

whatsapp: +1-415-670-9521

Phone: +1-415-670-9521

Email: [email protected]

TERMS & POLICIES

HELP & SUPPORT

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd