How much money would they have to deposit today

Assignment Help Financial Management
Reference no: EM131066453

Colin’s grandparents want to make a gift of $50,000 towards his college education fund in 12 years. How much money would they have to deposit today in an account that accrues interest monthly if the rate quoted by the bank is 6 percent?

Reference no: EM131066453

Questions Cloud

How to study more effectively : PSY352: Cognitive Psychology - How to Study More Effectively: Putting Knowledge of Memory Functioning to Work - examine the ability to create durable and easily accessible memories, which is an essential aspect of effective study techniques.
Future value and effective annual rate : How does the compounding frequency affect the future value and effective annual rate for a given deposit? Explain in terms of your findings in parts a through c
Four australian smart beta exchange traded funds : The spreadsheet, Report 2.xlsx contains data on four Australian smart beta exchange traded funds (ETFs) from June 2011 to April 2016. Each of these ETFs is passive as they attempt to track their chosen benchmark index, but they also have an activ..
Standard deviation of monthly changes in the spot price : The standard deviation of monthly changes in the spot price of live cattle is (in cents per pound) 1.35. The standard deviation of monthly changes in the futures price of live cattle for the closest contract is 0.8. The producer wants to use the Dece..
How much money would they have to deposit today : Colin’s grandparents want to make a gift of $50,000 towards his college education fund in 12 years. How much money would they have to deposit today in an account that accrues interest monthly if the rate quoted by the bank is 6 percent?
Determining the profit and cash flow : A firm has just ended its calendar year making a sale in the amount of $150,000 of merchandise purchased during the year at a cost of $112,500. Although the firm paid in full for the merchandise during the year, it has yet to collect at year end ..
What is the volume of the smallest solid cube : What is the volume of the smallest solid cube that can be made by stacking any number of these cuboids but each cuboid is stacked in same orientation?
Frequent compounding good for borrowers or for lenders : Would it be better for your retirement account if the returns on the security were simply compounded once a year? Explain why or why not. Is more frequent compounding good for borrowers or for lenders and why?
Impacting the quality of care provided : What can a health care organization do to reduce costs, without negatively impacting the quality of care provided?

Reviews

Write a Review

Financial Management Questions & Answers

  Investment opportunity-expected to produce cash flows

Lakonishok Equipment has an investment opportunity in Europe. The project costs €12 million and is expected to produce cash flows of €1.8 million in Year 1, €2.6 million in Year 2, and €3.5 million in Year 3. The current spot exchange rate is $1.36/€..

  Gas-powered and an electric-powered forklift truck

Hollygan Co. must choose between gas-powered and an electric-powered forklift truck for moving materials in its factory. Because both forklifts perform the same function, the firm will choose only one. (They are mutually exclusive investments.) Calcu..

  What is the real rate of return on these bonds

Blanc Plum Linens has bonds outstanding that pay a 2.5 percent semiannual coupon, have a 3.27 percent yield to maturity, and a face value of $1,000. The current rate of inflation is 2.12 percent. What is the real rate of return on these bonds? 0.86 p..

  Coupon bond paid annually with a face value

Your broker calls you up and tells you that she found a good deal on a bond. It's an 8% coupon bond paid annually with a face value of $1,000. It has 12 years until maturity. Using a discount rate of 7% what is the present value of this investment? I..

  Calculate the confidence index this year and last year

This Year Last Year Yield on top-rated corporate bonds 9.4% (this year) 9.9% (last year) Yield on intermediate-grade corporate bonds 11.9 (this year) 11.4 (last year) Calculate the confidence index this year and last year.

  The contract size for platinum futures

The contract size for platinum futures is 50 troy ounces. Sup-pose you need 300 troy ounces of platinum and the current futures price is $2,025 per ounce. How many contracts do you need to purchase? How much will you pay for your platinum? What is yo..

  About the concerning bonds

Which of the following is FALSE concerning bonds?

  Remodeling expenses and shelving costs are estimated

Jack is considering adding toys to his general store. He estimates that the cost of inventory will be $4,200. The remodeling expenses and shelving costs are estimated at $1,500. Toy sales are expected to produce net cash inflows of $1,200, $1,500, $1..

  What should be the average duration of its assets

Safelife insurance company has $85 million in assets, $80 million in liabilities, and $5million in shareholders' equity. The duration of liabilities is 3. If Safelife wants to immunize its net worth against interest rate risk (i.e. set the duration o..

  The total rate of return on this investment

Joelle purchased 100 shares of PAC stock for $20 per share and sold this same stock one year later for $25 per share. She paid commissions of $60 when she purchased the stock and $70 when she sold the stock. Dividends of $2 per share were paid during..

  What is the debt coverage ratio on the property

What is the debt coverage ratio on the following property?

  Annual contribution to her early retirement fund

Erika and Kitty, who are twins, just received $35,000 each for their 25th birthdays. They both have aspirations to become millionaires. Each plans to make a $5,000 annual contribution to her "early retirement fund" on her birthday, beginning a year f..

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!

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