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What will be the value of the investment

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Q1. Harriet just inherited $50,000,000. She knows nothing about money management and has decided to educate herself in that area before making any major decisions. She has a short-term investment for that period. She has the choice between two investments: Investment A: at 6.5% compounded daily Investment B: at 7% compounded semi-annually. Which option should she choose and why?

Q2. Harry is saving towards the down payment on a house. If he accumulates $5,000,000, his parents have offered to match his savings. He invests $2,000,000 at 9%. How long will it be before he can approach his parents for their contribution?

Q3. Jabari is planning for his retirement in 5 years' time. He plans to deposit $200,000 immediately into an investment plan that promises 11% annually. He will deposit $30,000 and the end of each of the next five years.

1. What will be the value of the investment when Jabari retires in 5 years?

2. Explain TWO (2) factors that affect the nominal interest rate.

Reference no: EM133188908

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