Compound Interest Factors Are Provided Below Using the Above Factors, Answer Each of the Following Questions

question 61

Essay

Compound interest factors are provided below: $\begin{array}{lcccc}&5\%,n=10&5\%,n=20&10\%,n=10&10\%,n=20\\\hline\text { Future value of a single sum } & 1.629 & 2.653 & 2.594 & 6.728 \\\text { Future value of an ordinary annuity } & 12.578 & 33.067 & 15.937 & 57.275 \\\text { Present value of a single sum } & 0.614 & 0.377 & 0.386 & 0.149 \\\text { Present value of an ordinary annuity } & 7.722 & 12.462 & 6.145 & 8.514 \\\text { Present value of an annuity due } & 8.108 & 13.085 & 6.759 & 9.365 \\\end{array}$
Using the above factors, answer each of the following questions.
a. How much will you have in 10 years if you invest $30,000 in an investment that earns 10%
semiannually?
b. How much do you have to invest today to have $30,000 in 10 years if the investment earns
10% annually?
c. How much will you have in 10 ysears if you invest $15,000 at the end of each year in an investment earning 10% annually?
d. How much do you have to invest today and every six months thereafter for the next 10 years if you want to accumulate a total of $400,000 10 years from today in an investment paying 10% semiannually?

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Definitions:

Decision Criteria

The standards or benchmarks that guide the decision-making process, helping individuals or organizations to choose among alternatives.

Cofounders' Relationship

The professional and often personal relationship between the individuals who establish a business together.

Emotional Commitment

A personal investment and engagement in certain values, goals, or relationships, often resulting in a stronger dedication to them.

Financial Commitment

The allocation of money towards investments, obligations, or projects with the expectation or requirement for future payout or returns.