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    Time value of money calculation

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    1. Joe Mauer, a catcher for the Minnesota twins is expected to hit 15 home runs in 2012. If his home run hitting ability is expected to grow 12 percent every year for the following five years, how many runs is he expected to hit in 2017?
    2. Roy Gross is considering an investment that pays 7.6 percent. How much will he have to invest today so that the investment will be worth $25000 in six years?
    3. Maria Addai has been offered a future payment of &750 two years from now. If she can earn 6.5 percent compounded annually on her investment, what should she pay for this investment today?

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    Solution Preview

    Please refer to below and feel free to let me know if you need further clarification.

    Answer:
    1.
    PV=15, ...

    Solution Summary

    This solution involves calculations for time value of money. The expert determines how many runs Joe Mauer is expecting to hit in the 2017 baseball season. How much will someone have to invest today to make $25000 in six years is given. The equations are provided.

    $2.19