Define the economy symbols and draw the cash-flow diagram

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1. How much money would be accumulated in 8 years if an investor deposits $6000 now at a nominal interest rate of 6.0% per year compounded semiannually?

2. How much should you be willing to pay for an annuity that will provide $300 every 3 months for 10 years starting 3 months from now if you want to make a nominal 12% per year compounded quarterly?

3. If you invest $30,000 now in a real estate venture, how much must you sell your property in 10 years from now if you want to make a 9% per year rate of return on your investment? Define the economy symbols and draw the cash-flow diagram.

4. How much money would be accumulated in 6 years if a person makes annual deposits that start with $600 now and increase by $60 per year for the next 6 years? Assume i is 10% per year and draw the cash-flow diagram.

5. A woman who has just won $80,000 in a lottery wants to deposit enough of her winnings into a savings account so that she will have $25,000 for her son's college education. Assume that her son has just turned 4 years old and will begin college when he is 18 years old. How much must the woman deposit now assuming that it would earn 6% per year compounded quarterly?

Reference no: EM131675053

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