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Calculate how much the insurance company must set

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Reference no: EM133184749

Question - Apollo Enterprises has been awarded an insurance settlement of $4,000 at the end of each 6 month period for the next 11 years.

Required -

a) As the accountant, calculate how much (in $) the insurance company must set aside now at 6% interest compounded semi-annually to pay this obligation to Apollo.

b) How much (in $) would the insurance company have to invest now if the Apollo settlement was changed to $2,000 at the end of each 3 month period for 11 years and the insurance company earned 8% interest compounded quarterly?

c) How much (in $) would the insurance company have to invest now if the Apollo settlement was paid at the beginning of each 3 month period rather than at the end?

Reference no: EM133184749

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