1. If $500 is invested at an annual interest rate of 8% years will be most nearl
ID: 2428759 • Letter: 1
Question
1. If $500 is invested at an annual interest rate of 8% years will be most nearly A.$1,200 B.$1,700 C.S5,031 D.$15,000 per year, its future worth at the end of 30 2. A corporation that pays %53 of its profit in income tax invests $10,000 in an asset th.t will produce $3000 annual revenue for eight years. If annual expenses are $700, salvage value $500 and 10% interest is used, what is after tax present worth. Discharge depreciation. 3. How many kilometers must a car be driven per year for leasing and buying to cost the same? Use 10% interest and year-end cost. Leasing: $0.15 per kilometer Buying: $$5000 purchase cost, 3-year life, salvage $1200, 0.04 per kilometer for gas and oil, S500 per year for insurance 4. It costs S75 per year to maintain a cemetery plot. If the interest rate is 6.0%, how much must be set aside to pay for maintenance on each plot without touching the principal? (A) SIISO (B) $1200 (C) S1250 (D) $1300Explanation / Answer
As the formula goes,
Future Value = Present Value x (1 + r)n
Future Value = $500 x (1 + 0.08)30
Future Value = $5,031
Correct answer, option C. $5,031
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