What is the amount he will have to save every year

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A. Your bank pays 10 per cent interest semiannually on your savings account . You don't expect the current balance of $ 3500 to change over the next 4 years. How much money can you expect to have at the end of this period?

B. Mike White is planning to save up for a trip to Europe in 3 years. He will need $ 10,000 when he is ready to make the trip. He plans to invest the same amount at the end of each of the next 3 years in an account paying 6 per cent annually. What is the amount he will have to save every year to reach his goal of $ 10,000 in 3 years?

C. An investment opportunity requires a payment of $ 592 for 12 years, starting a year from today. If your required rate of return is 8.8 per cent, what is the value of the investment today? Draw a timeline to support the answer (just write the numbers after each other as line).

Reference no: EM133015781

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