Assignment one particular Essay

п»їQuestion 1

(5 points) hundred buck today may be worth the SAME as $22.99 tomorrow.

Your Answer

Score

Explanation

True

False

Appropriate

5. 00

Correct. You comprehend time value

Total

a few. 00 as well as 5. 00

Question Description

We have thought that time worth of money is usually positive.

Question 2

(5 points) In an interest rate of 10% it is advisable to have $22.99 today than $120 in 2 years. The Answer

Score

Explanation

Authentic

Correct

five. 00

Right; it is compounding!

False

Total

5. 00 / 5. 00

Question Explanation

About compounding!

Query 3

(5 points) Shawn wants to buy a new telescope. He quotes that it will have him one full year to save the amount of money and that the telescope will cost one-hundred dollar. At an interest rate of 6%, how much truly does Shawn need to set aside today to purchase the telescope in a single year? (Enter just the amount without the $ sign or maybe a comma) Response for Question 3

You entered:

Your Answer

Score

Explanation

189

Correct

five. 00

Appropriate, You know it really must be less than two-hundred dollar.

Total

5. 00 as well as 5. 00

Question Reason

Simple PHOTOVOLTAIC calculation.

Problem 4

(10 points) Rob has $1, 000 that he buys a safe economical instrument anticipated to return 3% annually. Marge has $500 and invests in a more risky venture that is certainly expected to returning 7% yearly. Who has more after twenty years? And how very much does they have in FV terms? Your Solution

Score

Explanation

Jeff; 1935

Marge; 1935

Correct

10. 00

Right. You know how to calculate FVs!

Marge; 1806

Jeff; 1604

Marge; 1604

Jeff; 1806

Total

15. 00 / 10. 00

Question Explanation

FV measurements of simple one-shot funds flows. Shows power of increasing. Question a few

(10 points) Your dad invested $25 for you 70 years ago in a fund and you have not withdrawn any money seeing that. If the finance has proportioned a return of 8 percent over the last seventy years, precisely what is the current worth of that investment? (Round for the nearest entire dollar; get into just the quantity without the $ sign or maybe a comma) Answer for Issue 5

You entered:

Your Answer

Report

Explanation

5465

Correct

12. 00

Right. You know how to accurately determine FV.

Total

10. 00 / twelve. 00

Problem Explanation

Simple FV computation. The amount must be at least $165 even though you ignore compounding because a lot of years have passed. Question 6

(10 points) Cindy and Jennifer are double sisters. They will both have a $10, 000 investment earning 7%. Cindy withdraws $2, 000 of her cash and continues a shopping spree. Jennifer keeps most her money invested. Following 15 years, when every single are looking for cash to put a down payment on a house, just how much more really does Jennifer have got? (Enter only the number with no $ signal or a comma; round for the nearest whole dollar. ) Answer to get Question 6th

You entered:

Your Answer

Score

Explanation

5518

Correct

10. 00

Correct, know how to determine the difference in two FVs or worked out that only one particular FV have to be calculated in this specific case. Total

twelve. 00 as well as 10. 00

Question Reason

Difference at a later date Values or future benefit of a big difference? Question several

(10 points) Joe achievement ready to acquire a car. This individual has $20, 000 in investments getting 4. 9% annually. The auto also costs $20, 000. If this individual doesn't pay cash pertaining to the car, May well can get credit at 2 . 9% curiosity for a few years. The money is structured so that Joe pays 1 balloon repayment at the end of 5 years. The balloon payment comes with the principal in addition all fascination accrued over 5 years. If May well takes the money will he have enough money available from his investments to make the balloon payment? How much is going to he be short/have to spare? The Answer

Report

Explanation

Yes; 2331

Correct

10. 00

Correct decision and correct calculation.

Yes; 2082

No; 5404

No; 2331

No; 2082

Yes; 5404

Total

15. 00 as well as 10. 00

Question Justification

How to properly calculate the difference in two future values. Question almost eight

(15 points) Ralph knows that he...



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