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Virty [35]
3 years ago
14

Your bank offers a savings account that pays 3.5% interest, compounded annually. How much will $500 invested today be worth at t

he end of 25 years?a. $1,122.54b. $1,181.62c. $1,240.70d. $1,302.74e. $1,367.88
Business
1 answer:
Maksim231197 [3]3 years ago
6 0

Answer:

FV= $1,181.62

Explanation:

Giving the following information:

Your bank offers a savings account that pays 3.5% interest, compounded annually. How much will $500 invested today be worth at the end of 25 years?

We need to use the following formula:

FV= PV*(1+i)^n

FV= 500*(1+0.035)^25

FV= $1,181.62

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Most standard portfolio analysis methods evaluate strategic business units (sbus) on their performance in two important dimensio
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What is Strategic Business Unit?
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You have just won the lottery and will receive $460,000 in one year. You will receive payments for 27 years, and the payments wi
Zepler [3.9K]

Answer:

The present Value of my winnings = $4,578,716.35

Explanation:

An annuity is a series od annual cash outflows or inflows which payable or receivable for a certain number of periods. If the annual cash flow is expected  to increase by a certain percentage yearly, it is called a growing annuity.

To work out the the present value of a growing annuity,

we the formula:

PV = A/(r-g) ×  (1-  (1+g/1+r)^n)

I will break out the formula into two parts to make the workings very clear to follow. So applying this formula, we can work out the present value of the growing annuity (winnings) as follows.

A/(r-g)

= 460,000/(12%-3%)

= $5,111,111.11

(1-  (1+g/1+r)^n

1 - (1+3%)/(1+12%)^(27)

=0.8958

PV = A/(r-g) ×  (1-  (1+g/1+r)^n)

$5,111,111.11 × $0.8958

= $4,578,716.35

The present Value of my winnings = $4,578,716.35

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3 years ago
Which of the following is NOT a step in the strategic planning process?A) defining the company missionB) setting company objecti
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Answer:

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