1. You have no debt and $2,000 in your savings account. On your current budget, you figure that you can save an additional $2,000 each year. You want to put your money to work. Calculate the return on each of the investment options described below. a. Continue putting your money into your savings account, which earns an annual interest rate of 3 percent. What will be the balance of your savings account at the end of 10 years, and how much interest will you have earned?
Savings Balance:
Interest Earned:
b. Put your savings and the extra $2,000 into a mutual fund that earns 8 percent annually. If you reinvest your profits each year (earning compound interest), how much will you have in the mutual fund at the end of 10 years, and how much interest will you have earned?
Total in Mutual Fund:
Interest Earned:
c. Leave half of your $2,000 in savings, and invest the other half in the stock market. Do the same each year, putting $1,000 in stocks and the other $1,000 in savings. You earn 3 percent on your savings account and 10 percent on your stock investments. How much will you have earned from your savings account after 10 years? How much will you have earned from your stock investments after 10 years? How much money will you have between your savings account and your stocks combined after 10 years?
Money Earned from Savings Account:
Money Earned from Stock Market:
Total Money:
2. Your family gives you $5,000 as a college graduation present. You are about to start paying off $50,000 in student loans at a 4 percent interest rate for a 15-year loan. You could use this money to pay some of your loans, but you could also invest it.
a. Calculate the monthly payments and total payment you will be making on your loan if you do not use the $5,000 to make an initial payment.
Monthly Payment:
Total Amount Paid:
b. Calculate the monthly payments and total payment you will be making on your loan if you do use the $5,000 to make an initial payment.
Monthly Payment:
Total Amount Paid:
c. List two ways you could invest the money, and describe the expected returns from each method over a 15-year period.
d. What would you do with the $5,000? Explain why your choice makes financial sense to you.
Answers
Answer: (a) Saving balance = $20,600
Interest = $600
(b) Total in Mutual fund = $26,503.34
Interest earned = $3,903.34
(c) Money Earned from Savings Account= $11,330
Money Earned from Stock Market:$12,100
(2a) Monthly Payment = $7,503.93
Total Amount Paid = $90,047.18
(b) Monthly Payment =$6,753.53
Total Amount Paid = $81,042.46
(c) Peer - peer lending and index fund
Step-by-step explanation:
The Original money, which is the principal , in the savings account is $2,000
Savings each year = $2,000
Savings for 10 years = $2,000 x 10 = $20,000
Annual Interest rate = 3%
Interest for 10 years = PTR/100
= 2000 x 10 x 3 / 100
= 600
Total savings after 10 years = saving + interest
= $20,000 + $600
= $20,600
Therefore:
Savings balance = $20,600
Interest earned = $ 600
(b) The savings + the extra $2000 = $20,600 + $ 2,000
= $22,600
Interest rate = 8%
Interest = 22,600 x 1 x 8 / 100
= $1,808
That means profit = $ 1,808
Re – investing the profit, we will take the profit as the principal and then calculate the compounded interest for 10 years using the formula
A = P
= 1,808 (1.08)10
= $3,903.34
Amount in the mutual fund at the end of ten years implies
$22,600 + $3,903.34 = $26,503.34
Total in Mutual fund = $26,503.34
Interest earned = $3,903.34
(c) Since half of the $2,000 is left in savings, it means we have
$1,000 in savings
Savings after 10 years = $1,000 + 10 x $1,000 = $ 11,000
3% of savings = 0.03 x 11.000 = $330
Total money in Savings = $11,000 + $330
= $11,330
Also for Stock
Money in stock after 10 years = $1,000 + 10 x $1,000 = $11,000
10% of stock = 0.1 x $11,000 = $1,100
Total money in Stock = $11,000 + $1,100
= $12,100
Total money = money in savings + money in stock
= $11,330 + $12,100
= $23,430.00
(2) Amount given = $5,000
Loan = $50,000
Interest rate on loan = 4%
Calculating the amount the loan will yield after 15 years using the formula
A = P
A = 50,000 ( 1 + 0.04)15
A = $90,047.18
Therefore the compounded interest ( C.I) = $90,047.18 - $50,000
= $40,047.18
(a) If you do not use the $5,000 , the monthly payment = $90,047.18 / 12
= $7,503.93
And the total payment = $90,047.18
(b) If , $5,00 is used as the initial payment then the remaining loan will be
$50,000 - $5,000 = $45,000
So , we will have to calculate the amount $45,000 will yield after 15 years using the same formula
That is : A = 45,000 (1.04)15
A =$ 81,042.46
Therefore the C.I = $81,042.46 - $45,000
= $36,042.46
Monthly payment = $ 81,042.46/ 12
= $6,753.53
Total payment = $81,042.46
(c) Method of investing the money
(i) Peer to peer Lending. Giving helping hand one could earn
money as they pay back the loan with interest. If the interest is set to be 20%, for 15 years , 5000 will yield
5000(1.2)15 = $77,035.10
(ii) Index fund : Index funds are a collection of stocks, so your investment is automatically diversified. Index fund like E-trade could be invested into. Using the stock calculator , it would yield $141,144
(d) I would rather invest the money in E- trade since I am sure it would bring a profit more than the amount of the loan will yield after 15 years , I will even have more money to hold at habd
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mmm
Answers
Answer:
C. 16
Step-by-step explanation:
Two interior angles = One exterior angle.
x + y = z
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Answers
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8
Step-by-step explanation:
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Answer:
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can you give brainliest please?
Thank you!
change per week?
Answers
The average change per week is 3 cents per week if, over a 6-week period, the price of a gallon of gas increases by 18 cents.
What is the rate of change?
It is defined as the change in values of a dependent variable with respect to the independent variables.
It is given that:
Over a 6 week period, the price of a gallon of gas increased by 18 cents.
Let x be the average change per week.
The numerator, which is found at the top of the fraction number, is referred as the numerator, and the denominator, which is found at the bottom of the fractional number, is referred as the denominator.
The value of x can be calculated as follows:
x = 18/6
x = 3 cents per week
Thus, the average change per week is 3 cents per week if, over a 6-week period, the price of a gallon of gas increased by 18 cents.
Learn more about the rate of change here:
#SPJ2
Answers
then start from both sides cross off from both dies at the same time
83,84,85,85,86,86,86,87,87,88,89
84,85,85,86,86,86,87,87,88
85,85,86,86,86,87,87
85,86,86,86,87
85,86,86,86
86,86
so... 86 is the answer. i know its long but its the whole work hope it helped.