Siri plans to retire in 18 years and would like to receive $10 000.00 per month for twenty years starting at the end of the first month after her retirement. Calculate the amount he must invest now every month (at the end of the month) if interest is 4.9% compounded monthly.
A) $1 528 015
B) $4420.74
C) $633 665
D) $10 660
E) $11 755
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Jawad makes semi-annual contributions of $2000 starting on his 27th birthday. How much will he accumulate in his RRSP by age 60, if RRSP earns 8% compounded semi-annually and no contribution is made on his sixtieth birthday?
A) $615 535
B) $640 156
C) $565 324
D) $587 937
E) $669 842
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Calculate the amount of money that must be deposited at the end of every three months into an account paying 6% compounded monthly to accumulate to $12 500.00 in ten years?
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Sam took a $5000 loan to build a deck in the backyard. The loan requires payments at the end of each quarter or 4 years. If the interest on the loan is 9% compounded monthly, what is the size of each payment Sam is required to make?
A) $447.83
B) $353.98
C) $332.80
D) $1321.64
E) $376.08
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Siri plans to retire in 18 years and would like to receive $10 000.00 per month for twenty years starting at the end of the first month after her retirement. Calculate the amount he must invest now if interest is 4.9% compounded quarterly.
A) $1 528 015
B) $1 530 569
C) $633 665
D) $636 990
E) $539 042
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Knowing that the education costs for her kids would be huge, Roberta puts lump sum money from her inheritance in a savings account paying an interest of 4.69% compounded semi-annually. If ordinary annuity payments of $1500.00 per month are to be paid out of the account at the end of the month for four years starting fifteen years from now, how much did Roberta deposit?
A) $65 533
B) $32 474
C) $65 592
D) $32 723
E) $54 343
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Silva is contemplating to buy a 20 year annuity paying $2500 at the end of each month. What amount will be required to purchase the annuity, if the annuity provides a return of 6.75% compounded annually?
A) $334 000
B) $47 246
C) $600 000
D) $37 037
E) $567 436
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Sam got a job at the Brick. He plans to save $500 every month for 3 years to buy a car. The savings account earns 2.25% compounded monthly. If he puts the money in his savings account at the end of each month, how much interest is included in the future value of the annuity?
A) $18 000.00
B) $18 408.04
C) $18 603.37
D) $408.04
E) $603.37
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Pat won a lottery with two options: $1 million per year, at the beginning of the year, for 25 years or a single cash price of $18 million. If low-risk investments can earn 2.5% compounded annually, which option should Pat choose and what is the advantage in terms of current economic value?
A) Lump sum has an advantage of $885 000
B) 25 year annuity has an advantage of $885 000
C) 25 year annuity has an advantage of $424 000
D) Lump sum has an advantage of $424 000
E) Both options are the same
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Which is the most attractive of the following interest rates offered on a savings account?
A) 2.7% compounded annually
B) 2.68% compounded semiannually
C) 2.66% compounded quarterly
D) 2.64% compounded monthly
E) All of them offer the same effective rate.
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