Reference no: EM133190213
Questions -
Q1. Thomas wants to have $5,000 six years from now to buy a car. He has an investment account that earns 7% per year. How much would he have to deposit today, in order to have enough to buy the car?
Q2. Peter will receive a trust fund payment 8 years from now totaling $45,000. Based on a discount rate of 10.5%, how much is the trust fund payment worth in today's dollars?
Q3. Cameron wants to have $15,000 in 9 years for a down payment on a house. He has an investment account that earns 8% per year. How much would he have to invest today, in order to have enough to buy the car?
Q4. Jason just found a mutual fund that promises an 11.5% rate of return. He wants to use it to develop a college fund for his kids. If he wants to have $40,000, 18 years from now, how much money will Jason need to deposit today in the account?
Q5. Tammy has an heirloom that she's sure she can sell for $18,500 if she holds onto it for 16 years. She has a mutual fund that earns 12% interest, compounding monthly. Tammy was just offered $3,000 for this antique today. What is the PV of the heirloom? Should she sell it today?
Q6. Josh has an investment that has now grown to $60,000. If this investment has been earning 12.5% interest with monthly compounding for the past 18 years, what was his original investment amount?
Q7. Annie has an account that will be worth $7,000 after 8 years. How much is it worth today (PV) based on a rate of 7% that has MONTHLY compounding?
Q8. Josie has an antique artifact that she's sure she can sell for $15,000 if she holds onto it for 13 years. She has a special savings account that earns 6.5% interest, compounding quarterly. Josie was just offered $6,500 for this antique today. What is the PV of the antique? Should she sell it today?
Q9. Jackson has an account with a FV of $1,000,000 38 years from now. How much is it worth today (PV) based on a rate of 10% that has MONTHLY compounding?
Q10. Charlie just found out his old beanie baby bear is worth $42,000. He's had the bear for 15 years. If this bear's value grew at a rate of 85%, how much did Charlie pay for the bear, originally?
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