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Nata [24]
4 years ago
11

What must Bill McGuire invest today to receive an annuity of $12,000 for four years semiannually at a 10% annual rate? All withd

rawals will be made at the end of each period.
Mathematics
1 answer:
beks73 [17]4 years ago
8 0

Answer:

$77,558.55

Step-by-step explanation:

A fix periodic payment for specific period of time.

We need to calculate the present value annuity to determine the value of investment today.

Present value of annuity = P x ( 1 - ( 1 + r )^-n / r )

where

P = Periodic payment = $12,000

r = interest rate = 10% / 2 = 5%

n =numbers of payment = 4 years x 2 = 8 payments

Placing values in the formula

Investment Value today = $12,000 x ( 1 - ( 1 + 5% )^-8 / 5% )

Investment Value today = $77,558.55

You might be interested in
Use Lagrange multipliers to find the maximum and minimum values of f(x, y, z) = x − 2y + 5z on the sphere x 2 + y 2 + z 2 = 30.
Gekata [30.6K]

Answer:

Maximum: ((1,-2,5) ; 30)

Minimum: ((-1,2,-5) ; -30)

Step-by-step explanation:

We have the function f(x,y,z) = x - 2y + 5z, with the constraint g(x,y,z) = 30, with g(x,y,z) = x²+y²+z². The Lagrange multipliers Theorem states that, the points (xo,yo,zo) of the sphere where the function takes its extreme values  should satisfy this equation:

grad(f) (xo,yo,zo) = λ * grad(g) (xo,yo,zo)

for a certain real number λ. The gradient of f evaluated on a point (x,y,z) has in its coordinates the values of the partial derivates of f evaluated on (x,y,z). The partial derivates can be calculated by taking the derivate of the function by the respective variable, treating the other variables as if they were constants.

Thus, for example, fx (x,y,z) = d/dx x-2y+5z = 1, because we treat -2y and 5z as constant expressions, and the partial derivate on those terms is therefore 0. We calculate the partial derivates of both f and g

  • fx(x,y,z) = 1
  • fy(x,y,z) = -2
  • fz(x,y,z) = 5
  • gx(x,y,z) = 2x (remember that y² and z² are treated as constants)
  • gy(x,y,z) = 2y
  • gz(x,y,z) = 2z

Thus, for a critical point (x,y,z) we have this restrictions:

  • 1 = λ 2x
  • -2 = λ 2y
  • 5 = λ 2z
  • x²+y²+z² = 30

The last equation is just the constraint given by g, that (x,y,z) should verify.

We can put every variable in function of λ, and we obtain the following equations.

  • x = 1/2λ
  • y = -2/2λ = -1/λ
  • z = 5/2λ

Now, we replace those values with the constraint, obtaining

(1/2λ)² + (-1/λ)²+(5/2λ)² = 30

Developing the squares and taking 1/λ² as common factor, we obtain

(1/λ²) * (1/4 + 1 + 25/4) = (1/λ²) * 30/4 = 30

Hence, λ² = 1/4, or, equivalently,\lambda =^+_- \frac{1}{2} .

If \lambda = \frac{1}{2} , then 1/λ is 2, and therefore

  • x = 1
  • y = -2
  • z = 5

and f(x,y,z) = f(1,-2,5) = 1 -2 * (-2) + 5*5 = 30

If \lambda = - \frac{1}{2} , then 1/λ is -2, and we have

  • x = -1
  • y = 2
  • z = -5

and f(x,y,z) = f(-1,2,-5) = -1 -2*2 + 5*(-5) = -30.

Since the extreme values can be reached only within those two points, we conclude that the maximun value of f in the sphere takes place on ((1,-2,5) ; 30), and the minimun value takes place on ((-1,2,-5) ; -30).

5 0
4 years ago
Which two integers is square root 44 between?
11111nata11111 [884]

Answer:6 and 7

Step-by-step explanation:

4 0
2 years ago
Read 2 more answers
Each day last week, Mills walked 3/4 of a mile. What is the total distance, in miles that Ms.Mills walked in 4 days?
Tju [1.3M]

3/4 * 4 = 3 miles in 4 days. you can look at it as a decimal/money to to help 3/4 is .75 and .75+.75+.75+.75=3.00 hope it helps and explains how to get the answer.

4 0
4 years ago
PLEASE HELP!!!!!!!!!!!!!!!!!!!!!!!
Anna [14]
4 inches, wryyyyyyyyyyy
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Jill and Alberto are selling wrapping paper for a school fundraiser. Customers can buy rolls of plain wrapping paper and rolls o
Arada [10]

Answer:

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Step-by-step explanation:

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