Suppose you plan to have $90,000 in 15 years from now and you can invest your savings at 2% compounded continuously. Assuming you can save the same amount of money each year, how much do you need to save on a yearly basis in order to achieve your goal Hint: Treat your savings as an income stream. wearly savings (exact value] = Yearly savings (rounded to the nearest cent) = dollars dollars

Suppose you plan to have $90,000 in 15 years from now and you can invest your savings at 2% compounded continuously. Assuming you can save the same amount of money each year, how much do you need to save on a yearly basis in order to achieve your goal Hint: Treat your savings as an income stream. wearly savings (exact value] = Yearly savings (rounded to the nearest cent) = dollars dollars

Pfin (with Mindtap, 1 Term Printed Access Card) (mindtap Course List)

7th Edition

ISBN:9780357033609

Author:Randall Billingsley, Lawrence J. Gitman, Michael D. Joehnk

Publisher:Randall Billingsley, Lawrence J. Gitman, Michael D. Joehnk

Chapter4: Managing Your Cash And Savings

Section: Chapter Questions

Problem 7FPE: Calculating interest earned and future value of savings account. If you put 6,000 in a savings...

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Calculating interest earned and future value of savings account. If you put 6,000 in a savings account that pays interest at the rate of 3 percent, compounded annually, how much will you have in five years? (Hint: Use the future value formula.) How much interest will you earn during the five years? If you put 6,000 each year into a savings account that pays interest at the rate of 4 percent a year, how much would you have after five years?
Suppose you plan to have $70,000 in 25 years from now and you can invest your savings at 6% compounded continuously. Assuming you can save the same amount of money each year, how much do you need to save on a yearly basis in order to achieve your goal? Hint: Treat your savings as an income stream. Yearly savings (exact value) =________ dol Yearly savings (rounded to the nearest cent) = _____dollars
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An example of how to calculate net present value is done using the following. Imagine you have been given an investment opportunity wherein if you invest $1,200 today, you will receive $650 dollars at the end of each year for the next 5 years. You could separately choose to invest your money at 10% interest each year. Should you take the investment opportunity? To find the answer, use the NPV formula:
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