Future value, present value and finding the required interes
Not what you're looking for?
Please help me out with the following questions.
1 -Future value -
If you deposit $ 10,000 in a bank account that pays 10 percent interest annually, how much would be in your account after 5 years?
2- Present value -
What is the present value of a security that will pay $ 5,000 in 20 years if securities of equal risk pay 7 percent annually?
3- Finding the required interest rate-
Your parents will retire in 18 years. They currently have $ 250,000, and they think they will need $ 1,000,000 at retirement. What annual interest rate must they earn to reach their goal, assuming they don't save any additional funds?
Purchase this Solution
Solution Summary
This solution is comprised of a detailed explanation to calculate the future value, present value, and the required rate of return.
Solution Preview
1 -Future value -
If you deposit $ 10,000 in a bank account that pays 10 percent interest annually, how much would be in your account after 5 years?
FV = PV (1+i)n where PV is the present value
FV is the future value
i is the interest rate
n is the period
FV = 10,000(1 ...
Purchase this Solution
Free BrainMass Quizzes
Situational Leadership
This quiz will help you better understand Situational Leadership and its theories.
Motivation
This tests some key elements of major motivation theories.
Income Streams
In our ever changing world, developing secondary income streams is becoming more important. This quiz provides a brief overview of income sources.
Balance Sheet
The Fundamental Classified Balance Sheet. What to know to make it easy.
Transformational Leadership
This quiz covers the topic of transformational leadership. Specifically, this quiz covers the theories proposed by James MacGregor Burns and Bernard Bass. Students familiar with transformational leadership should easily be able to answer the questions detailed below.