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Problem 11

Find the periodic payments necessary to accumulate the amounts given in Exercises \(7-12\) in a sinking fund. (Assume end-of-period deposits and compounding at the same intervals as deposits.) \(\$ 20,000\) in a fund paying \(5 \%\) per year, with monthly payments for 5 years, if the fund contains \(\$ 10,000\) at the start

Expert verified

To accumulate $20,000 after 5 years in a sinking fund with a starting amount of $10,000 and a 5% annual interest rate, we need to make periodic payments of approximately $154.97 per month.

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Chapter 5

You have a \(\$ 2,000\) credit card debt, and you plan to pay it off through monthly payments of \(\$ 50\). If you are being charged \(15 \%\) interest per year, how long (to the nearest \(0.5\) years) will it take you to repay your debt?

Chapter 5

Find the effective annual interest rates of the given annual interest rates. Round your answers to the nearest \(0.01 \%\). \(5 \%\) compounded quarterly

Chapter 5

By graphing the future value of a $$\$ 100$$ investment that is depreciating by \(1 \%\) each year, convince yourself that, eventually, the future value will be less than $$\$ 1.$$

Chapter 5

Calculate the present value of an investment that will be worth $$\$ 1,000$$ at the stated interest rate after the stated amount of time. 4 years, depreciating \(5 \%\) each year

Chapter 5

Compute the specified quantity. Round all answers to the nearest month, the nearest cent, or the nearest \(0.001 \%\), as appropriate. Fees You are expecting a tax refund of 1,000$ in 4 weeks. A tax preparer offers you a \(\$ 1,000\) loan for a fee of $\$ 50 to be repaid by your refund check when it arrives in 4 weeks. Thinking of the fee as interest, what simple interest rate would you be paying on this loan?

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