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evablogger [386]
3 years ago
10

Suppose you invest semiannually for 25 years in an annuity that pays 5% interest, compounded semiannually. At the end of the 25

years, you have $500,000. How much of this total is interest? Enter your answer rounded to the nearest hundred dollars.
Business
1 answer:
bonufazy [111]3 years ago
7 0

Answer:

$354,500

Explanation:

First find the amount invested ie the Present Value as follows :

n = 25 × 2 = 50

i = 5%

P/yr = 2

Pmt = $0

Fv = $500,000

Pv = ?

Using a Financial Calculator to enter the amounts as above, the Present Value is $145,471

Total Interest = Future Value - Present Value

                      = $500,000 - $145,471

                      = $354,529

Thus interest is $354,500 (nearest hundred dollars).

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Answer and Explanation:

The computation is shown below:

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= (1.1451)^4 - 1

= 1.719387079 - 1

= 0.719387079 or 71.94%

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2 years ago
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Answer:

People who have finished their bachelor's degree.

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Explanation:

Hope this helps!

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The fictional country of Alperta increases the income tax rate so that tax revenues increase by $50 million. If GDP, consumption
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In Cafeteria plan plans, the employer allocates a certain amount of money to each employee and lets the employee spend that money for benefits that suit him or her.

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