How much money should steve put into the account

Assignment Help Microeconomics

Reference no: EM132160474

Question: Steve Lowe must pay his property taxes in two equal installments on December 1 and April 1. The two payments are for taxes for the fiscal year that begins on July l and ends the following June 30. Steve purchased a home on September 1. Assuming the annual property taxes remain at $850 per year for the next several years, Steve plans to open a savings account and to make uniform monthly deposits the first of each month. The account is to be used to pay the taxes when they are due. To open the account, Steve deposits a lump sum equivalent to the monthly payments that will not have been made for the first year's taxes. The savings account pays 9% interest, compounded monthly and payable quarterly (March 31, June 30, September 30, and December 31). How much money should Steve put into the account when he opens it on September 1? What uniform monthly deposit should he make from that time on?

Reference no: EM132160474

Questions Cloud

How much money must art donate to k-state : Art Arfons, a K-State-educated engineer, has made a considerable fortune. He wishes to start a perpetual scholarship for engineering students at K-State.

Prepare a brief email on the vacation policy changes : Your supervisor has asked you to write a brief email on the vacation policy changes to be distributed to staff.

What is the equivalent uniform annual cost of the machine : A machine costs $20,000 and has a 5-year useful life. At the end of the 5 years, it can be sold for $4000. If annual interest is 8%, compounded semiannually.

What is the amount of the monthly payments : Mr. Wiggley wants to buy a new house. It will cost $178,000. The bank will loan 90% of the purchase price at a nominal interest rate of 10.75% compoundedweekly.

How much money should steve put into the account : Steve Lowe must pay his property taxes in two equal installments on December 1 and April 1. The two payments are for taxes for the fiscal year that begins.

How all program objectives will be incorporated : Select a Health Care Research Capstone topic and develop a plan on how all program objectives will be incorporated into the project materials.

What is the required quarterly deposit : Your company must make a $500,000 balloon payment on a lease 2 years and 9 months from today. You have been directed to deposit an amount of money quarterly.

What is the job description : In your own words, what is the job description? What skills, experience, education, and certification(s) are needed to be successful?

What uniform amount could be used for student scholarship : Linda O'Shay deposited $30,000 in a savings account as a perpetual trust. She believes the account will earn 7% annual interest during the first 10 years.

User Account

All Pages