0.9 Mathematics of finance: homework  (Page 7/7)

The population of a city of 80,000 is growing at a rate of 3.2% per year. What will the population be at the end of 10 years?

A sum of $5000 is deposited in a bank today. What will the final amount be in 20 months if the bank pays 9% and the interest is compounded monthly?

A computer is sold for $500 cash and $50 per month for the next 3 years. Find the cash value of the computer today if the money is worth 6.2% compounded monthly.

The United States paid about 4 cents an acre for the Louisiana Purchase in 1803. Suppose the value of this property grew at a rate of 5.5% annually. What would an acre be worth in the year 2000?

What amount should be invested per month at 9.1% compounded monthly so that it will become $5000 in 17 months?

A machine costs $8000 and has a life of 5 years. It can be leased for $160 per month for 5 years with a cash down payment of $750. If the current interest rate is 8.3%, is it cheaper to lease or to buy?

If inflation holds at 5.2% per year for 5 years, what will be the cost in 5 years of a car that costs $16,000 today? How much will you need to deposit each quarter in a sinking fund earning 8.7% per year to purchase the new car in 5 years?

City Bank pays an interest rate of 6%, while Western Bank pays 5.8% compounded continuously. Which one is a better deal?

Ali has inherited $20,000 and is planning to invest this amount at 7.9% interest. At the same time he wishes to make equal monthly withdrawals to use up the entire sum in 5 years. How much can he withdraw each month?

Jason has a choice of receiving $300 per month for the next 5 years or $500 per month for the next 3 years. Which one is worth more if the current interest rate is 7.7%?

If a bank pays 6.8% compounded continuously, how long will it take to double your money?

Janus Mutual Funds claims a growth rate of 17% per year. If $500 per month is invested, what will the final amount be in 15 years?

Mr. Vasquez has been given two choices for his compensation. He can have $20,000 cash plus $500 per month for 10 years, or he can receive $12,000 cash plus $1000 per month for 5 years. If the interest rate is 8%, which is the better offer?

How much should Mr. Shackley deposit in a trust account so that his daughter can withdraw $400 per month for 4 years if the interest rate is 8%?

Mr. Albers borrowed $425,000 from the bank for his new house at an interest rate of 9%. He will make equal monthly payments for the next 30 years. How much money will he end up paying the bank over the life of the loan, and how much is the interest?

Mr. Tong puts away $500 per month for 10 years in an account that earns 9.3%. After 10 years, he decides to withdraw $1,000 per month. If the interest rate stays the same, how long will it take Mr. Tong to deplete the account?

An amount of $5000 is borrowed for 15 months at an interest rate of 9%. Determine the monthly payment and construct an amortization schedule showing the monthly payment, the monthly interest on the outstanding balance, the amount of payment contributing towards debt, and the outstanding debt.