Central Texas College Money and Banking Questions – Question Description
I’m working on a economics multi-part question and need the explanation and answer to help me learn.
1.) What lump sum deposited today would allow payments $2000/ a year, for 7 years, at 5% compounded annually?
2.) If you invest $20,000 at an annual interest rate of 4.75%, continuously, calculate the future value (FV) of your investment over a 5-year period. Then, go back and calculate the future-value (FV) of your initial $20,000 investment with a discrete-quarterly compounded annual interest rate of 5.25%, over a 10-year period.
3.) Find the accumulated amount (future-value [FV]) after 4 years of $1,200 invested at an 8% annual interest rate compounded:
(A) Discretely monthly
(B) Continuously
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