BUSINESS COLLEGE

Dwayne invests $4,700 in a savings account at the beginning of each of the next twelve years. if his opportunity cost rate is 7 percent compounded annually, how much will his investment be worth after the last annuity payment is made? use the equation method to calculate the worth of the investment. (round your answer to two decimal places.)

Answers

Answer 1

Answer:

Answer: Dwayne's investment will be worth $89,961.02 after the last annuity payment is made.

Since Dwayne contributes $4700 at the beginning of each year, we need to calculate the future value of an annuity due.

We use this formula for our calculations:

$\mathbf{FV _(Annuity due) = PMT * \left [ ((1+r)^(n)-1)/(r) \right ]*(1+r)}$

Substituting the values we get,

$\mathbf{FV _(Annuity due) = 4700 * \left [ ((1+0.7)^(12)-1)/(0.07) \right ]*(1+0.07)}$

$\mathbf{FV _(Annuity due) = 4700 * \left [ \frac{2.252191589}-1}{0.07} \right ]*(1.07)}$

$\mathbf{FV _(Annuity due) = 4700 * \left [ \frac{1.252191589}}{0.07} \right ]*(1.07)}$

$\mathbf{FV _(Annuity due) = 4700 * 17.88845127 *(1.07)}$

$\mathbf{FV _(Annuity due) = 89961.02144}$

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Answers

Answer:

PV= $248,368.53

Explanation:

Giving the following information:

Future Value (FV)= $400,000

Number of periods (n)= 5

Interest rate (i)= 10% = 0.1

To calculate the present value (PV), we need to use the following formula:

FV= PV*(1í)^n

Isolating PV:

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Answers

Answer:

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Answers

Answer:

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Answers

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Answer:

Explanation:

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Answers

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