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You think you can earn an annual interest rate of 8%. You will b
compounded monthly at the beginning of the month. How much money do you need to start out with now to have $1,000,000
2. Assume that you know you can afford monthly payments of $1,000 to pay off a loan. The loan is for 30 years, and the inte
payments every month at the end of the month. The balance owed at the end of the 30 years will be $0. How much can you
3. You have just won KBC that is worth 5 crores (5,000,000). However, the 5 crores will be paid out at the rate of $25,00,000
20 years. You think that if you received a lump sum, you would be able to invest it at an annual rate of 6%. How much mone
invested at an annual rate of 6% would allow you to withdraw 2500000 per year for 20 years (ending up with a balance of 0 in
withdrawal)?
FUTURE VALUE $0
TIME 20
YEARLY PAYMENT $2,500,000
RATE OF INTEREST 6%
PRESENT VALUE $ -30,395,291
interest rate of 8%. You will be making monthly deposits of $100. Interest is
ut with now to have $1,000,000 in 30 years?
an is for 30 years, and the interest rate is 10.00% (annual rate). You make
will be $0. How much can you afford to borrow?
d out at the rate of $25,00,000 per year (at the beginning of each year) for
al rate of 6%. How much money would you have to receive today, which if
nding up with a balance of 0 in the savings account after the last
4. How much will you have in the bank if you start with $20,000 and save $2000 per month (at the beginning of each month)
compounded monthly.
5. You want to borrow home loan of $15,00,000 for 20 years at an annual rate of 9%. You will make monthly payments (12 pe
interest period. The balance at the end of the loan will be $0 (you will completely pay it off). What is your monthly payment
6. A motorist buys a car for $12000 and intends to keep it for six years. If the resale value at the end of that time(6 years) is
$2000, what is the NPV of the car’s cost over six year period? Take interest as 7%.
monthly payments (12 per year), and payments will be at the end of each
t is your monthly payment?
nd of that time(6 years) is expected to be $4000, and annual running costs are
₹ 2,305.53