Question
I have solved both of these already. What I cant figure out is why for 112 you solve for the future worth first then the present worth when in 114 which is worded the same exact way you solve for present first then future??????
WHAT THE HELL?????
Please explain.
Ann deposits $100 at the end of each month into her bank savings account. The bank paid 6% nominal interest, compounded and paid quarterly. No interest was paid on money not in the account for the full 3-month period. How much was in Ann's account at the end of 3 years? (Answer: $3912.30) What is the present worth of a series of equal quarterly payments of $3000 that extends over a period of 8 years if the interest rate is 10% compounded monthly? What single amount on April 1, 2012, is equivalent to a series of equal, semiannual cash flows of $1000 that starts with a cash flow on January 1, 2010. and ends with a cash flow on January 1, 2019? The interest rate is 14% and compounding is quarterly. A contractor wishes to set up a special fund by making uniform semiannual end-ot-period deposits for 20 years. The fund is to provide $10,000 at the end of each of the last 5 years of the 20-year period. If interest is 8%. compounded semiannually, what is the required semiannual deposit? Paco's saving account earns 13% compounded weekly and receives quarterly deposits of $38,000. His first deposit occurred on October 1, 2006. and the last deposit is scheduled for April 1, 2022. Tisha's account earns 13% compounded weekly. Semiannual deposits of $18.000 are made into her account, with the first one occurring on July 1, 2016, and the last one occurring on January 1, 2025. What single amount on January 1, 2017, is equivalent to the sum of both cash flow series?
Explanation / Answer
for 112
P =A*((1+i)^n -1)/(i(1+i)^n)
here A =1000
number of periods =9 years =432 quarters
interest per quarter =14/4 =3.5%
P =1000*((1+.035)^432-1)/(.035*(1+.035)^436)
=28571.41