Deposit in an account paying eight percent annual interest

Assignment Help Financial Management

Reference no: EM131047245

Linda has decided to set up an account that will pay her granddaughter (Janice) $5,000 a year indefinitely. How much should Linda deposit in an account paying 8 percent annual interest?

Reference no: EM131047245

Questions Cloud

Total profits for giving a seminar on cost estimating : Create a spreadsheet to calculate your projected total costs, total revenues, and total profits for giving a seminar on cost estimating. Make the following assumptions: You will charge $600 per person for a two-day class. You estimate that 30 people ..

Expected to grow at rate-what is current share price : Synovec Co. is growing quickly. Dividends are expected to grow at a rate of 26 percent for the next three years, with the growth rate falling off to a constant 6 percent thereafter. If the required return is 12 percent, and the company just paid a di..

What is the bonds nominal annual yield to call : Ace Products has a bond issue outstanding with 15 years remaining to maturity, a coupon rate of 7.4% with semiannual payments of $37, and a par value of $1,000. The price of each bond in the issue is $1,200.00. The bond issue is callable in 5 years a..

Economic order quantity model : Cheeseburger and Taco Company purchases 12,349 boxes of cheese each year. It costs $12 to place and ship each order and $4.62 per year for each box held as inventory. The company is using Economic Order Quantity model in placing the orders. What is t..

Deposit in an account paying eight percent annual interest : Linda has decided to set up an account that will pay her granddaughter (Janice) $5,000 a year indefinitely. How much should Linda deposit in an account paying 8 percent annual interest?

Minimum expected annual return for stock : In order to fund her retirement, Michele requires a portfolio with an expected return of 0.11 per year over the next 30 years. She has decided to invest in Stocks 1, 2, and 3, with 25 percent in Stock 1, 50 percent in Stock 2, and 25 percent in Stock..

Compute the standard deviation of monthly returns : The past five monthly returns for PG&E are −3.19 percent, 3.93 percent, 3.79 percent, 6.50 percent, and 3.60 percent. Compute the standard deviation of PG&E’s monthly returns.

The terms of the line of credit called : On January 2, 20X1, Uptown Hospital established a line of credit with First Union National Bank. The terms of the line of credit called for a $400,000 maximum loan with an interest rate of 3 percent. The compensating balance requirement is 5 percent ..

Zero estimated salvage value on a straight-line basis : Mom’s Cookies, Inc., is considering the purchase of a new cookie oven. The original cost of the old oven was $44,000; it is now five years old, and it has a current market value of $19,500. The old oven is being depreciated over a 10-year life toward..

User Account

All Pages