finance data bank

Question # 00003515 Posted By: spqr Updated on: 11/13/2013 01:19 PM Due on: 11/30/2013
Subject Finance Topic Finance Tutorials:
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31. You just received a $5,000 gift from your grandmother. You have decided to save this money so that you can gift it to your grandchildren 50 years from now. How much additional money will you have to gift to your grandchildren if you can earn an average of 8.5 percent instead of just 8 percent on your savings?

A. $47,318.09

B. $52,464.79

C. $55,211.16

D. $58,811.99

E. $60,923.52

32. You are depositing $1,500 in a retirement account today and expect to earn an average return of 7.5 percent on this money. How much additional income will you earn if you leave the money invested for 45 years instead of just 40 years?

A. $10,723.08

B. $11,790.90

C. $12,441.56

D. $12,908.19

E. $13,590.93

33. You collect old coins. Today, you have two coins each of which is valued at $250. One coin is expected to increase in value by 6 percent annually while the other coin is expected to increase in value by 4.5 percent annually. What will be the difference in the value of the two coins 15 years from now?

A. $115.32

B. $208.04

C. $241.79

D. $254.24

E. $280.15

34. Your father invested a lump sum 26 years ago at 4.25 percent interest. Today, he gave you the proceeds of that investment which totaled $51,480.79. How much did your father originally invest?

A. $15,929.47

B. $16,500.00

C. $17,444.86

D. $17,500.00

E. $17,999.45

35. What is the present value of $150,000 to be received 8 years from today if the discount rate is 11 percent?

A. $65,088.97

B. $71,147.07

C. $74,141.41

D. $79,806.18

E. $83,291.06

36. You would like to give your daughter $75,000 towards her college education 17 years from now. How much money must you set aside today for this purpose if you can earn 8 percent on your investments?

A. $18,388.19

B. $20,270.17

C. $28,417.67

D. $29,311.13

E. $32,488.37

37. You want to have $35,000 saved 6 years from now to buy a house. How much less do you have to deposit today to reach this goal if you can earn 5.5 percent rather than 5 percent on your savings? Today's deposit is the only deposit you will make to this savings account.

A. $733.94

B. $791.18

C. $824.60

D. $845.11

E. $919.02

38. Your older sister deposited $5,000 today at 8.5 percent interest for 5 years. You would like to have just as much money at the end of the next 5 years as your sister will have. However, you can only earn 7 percent interest. How much more money must you deposit today than your sister did if you are to have the same amount at the end of the 5 years?

A. $321.19

B. $360.43

C. $387.78

D. $401.21

E. $413.39

39. A year ago, you deposited $30,000 into a retirement savings account at a fixed rate of 5.5 percent. Today, you could earn a fixed rate of 6.5 percent on a similar type account. However, your rate is fixed and cannot be adjusted. How much less could you have deposited last year if you could have earned a fixed rate of 6.5 percent and still have the same amount as you currently will when you retire 38 years from today?

A. $2,118.42 less

B. $3,333.33 less

C. $5,417.09 less

D. $7,274.12 less

E. $9,234.97 less

40. When you retire 40 years from now, you want to have $1.2 million. You think you can earn an average of 12 percent on your investments. To meet your goal, you are trying to decide whether to deposit a lump sum today, or to wait and deposit a lump sum 2 years from today. How much more will you have to deposit as a lump sum if you wait for 2 years before making the deposit?

A. $1,414.14

B. $2,319.47

C. $2,891.11

D. $3,280.78

E. $3,406.78

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Tutorials for this Question
  1. Tutorial # 00003322 Posted By: spqr Posted on: 11/13/2013 01:30 PM
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