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Paul [167]
3 years ago
15

Graham receives $640,000 at his retirement. he invests x in a twenty-year annuityimmediate with annual payments and the remainin

g $640, 000 − x is used to purchase a perpetuity-immediate with annual payments. his total annual payments received during the first twenty years are twice as large as those received thereafter. the annual effective interest rate is 5%. find x.
Business
1 answer:
Sauron [17]3 years ago
6 0
<span>For the amount invested in the 20 year annuity immediate,

the return will be;
 r/(1 - (1+r)^-n) = 0.05/(1- 1.05^-20)
= 0.0802425872
= 8.02425872% 

Now, return on perpetuity-immediate = 5% 

So, 5% + </span>8.02425872% = 13.02425872<span>

for equal returns from both investments,
X = 5/(13.02425872) x 640,000

= $245,695.365 

= $ 245,695.36 </span>
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Answer:

Debit Office Furniture account    $710

Credit Cash account                    $170

Credit Accounts payable             $710

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Explanation:

When items are purchased using cash, the corresponding credits in such transactions are recorded in the cash account. Where the item is purchased on account (or credit), the credit is posted to accounts payable.

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The total debit for this will be recorded in the office furniture account.

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Debit Office Furniture account    $710

Credit Cash account                    $170

Credit Accounts payable             $710

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An increase in the real wage would result in a:________. a. shift of the labor demand curve, causing an increase in the number o
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An increase in the real wage would result in a: movement along the labor demand curve, causing a decrease in the number of workers hired by the firm.

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