1. If you deposit exist150 into an account even quarter from the time you start college until you graduate years later, what will be the balance in the account assuming you can cam 5% APR interest on the balance? Now, if once you graduate, you leave the balance in and don t add anything to it. how much will you have after 20 more years have passed (i.e. 25 years from now) still assuming interest is compounded quarterly? Now, repeat the question assuming that you deposit exist600 annually and earn interest annually instead of quarterly.
2. You are offered an investment which pays you $750 per month for 5 years. You receive the $750 at the beginning of each month. If you require a rate of return of 6%, what is the present value of this investment?
3. You put $500 into a savings account twice a year (at the beginning of the period). You earn 2.5% interest, compounded semi-annually.
4. What will the balance be after 15 years? What is the required rate of return for an investment that pays $325 monthly, has a present value of $14000, a future value of exist0, and a time horizon of 4 years?