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Question 1. Determine the future worth in year 10 of a cash flow series that starts in...

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Finance

Question 1.

Determine the future worth in year 10 of a cash flow series thatstarts in year 0 (today) at $25,000 and decreases by 6% per year(through year 10). Use an interest rate of 6%.

Question 2.

Person opens a savings account today. In year1, she deposited $5,000. She made no deposits in year 2 and 3 andthen deposit $2,000 each for years 4 trough 6. Given an interestrate of 4%, how much would she have needed to deposit each year ifshe made expial payments in years 1 through 6 to have the sameamount in the account at the end of year 6?

Answer & Explanation Solved by verified expert
4.2 Ratings (761 Votes)
Question 1 Here as per the question in the year 0 person has deposited 25000 and than she is depositing the money till year 10 The deposits has reduced by 6 every year So his deposits will be Year 0 25000 Year 1 23500 25000 250006    See Answer
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