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  3. 1. james deposits $200 in a bank account on the la

1. James deposits $200 in a bank account on the last day of each month. He...

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Finance

1. James deposits $200 in a bank account on the last day of eachmonth. He increases the deposit by $10 each month. The paymentscontinue for a period of 36 months.

What is the present value of these payments on the day of thefirst payment (to the nearest dollar)? The nominal interest rate is8% compounded monthly.

2. $1000 accumulates to $1500 in 5 years time and the rate ofinflation is 3% p.a.

What is the annual effective real rate of return?

Answer & Explanation Solved by verified expert
3.8 Ratings (613 Votes)
1 Annual Rate 8 Compounding FrequencyMonthly    See Answer
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