a. How much would you have to deposlt boday If you wented to have $60000 in four

Question

a. How much would you have to deposlt boday If you wented to have $60000 in four years? Annual Interest rate ls g% PVcf51, FVct$1, PVA ofel, end eAofS1 (Use appropriate foc torts) hom the tables provided. b. Assume that you are saing ?? for a trip around the world when you graduate in two years. If you can earn 8% on your investments, now mucn would you have to deposit 10day to have $15,000 when you graduare? IRound your answer to 2 declmal places) of 5463 for 10 years c-1. Calculate the TLture value or an investment answer to 2 decimel pleces.) ening an interest or 9%, (Round your c-2 would you rather have S463 now cr $1,000 ten years from now? Ten years from now & Now d. Assume that e callege pariang sncker today casts $s0. If the cast of parking is Increasing at the rate of 5% per year, how much wil the college parking sicoer cost re ght years? (Round your answer to 2 declmal places

Explanation / Answer

Solution:-

(a) Deposit today = Present value of 60000 @ 9%

PVIF(9%,4yrs)=0.71

60000*0.713 = 42600

(b) PV of 15000

PVIF @8% = 0.86

15000*0.86 = 12900

(c1) I am not able to read the investment value

I thought it is 463

Future value of 463 after 10 years @ 9%

Future value = (463) (1.09)10 = 1096

(c2) 463 now

(d) packing cost after 8 years

90*(1.05)8 = 132.97

(e) Future price = 158500* (1.10)8 = 339759

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