NON ANNUAL COMPOUNDING
You plan to make five deposits of $1,000 each, one every 6 months, with the first payment being made in 6 months. You will then make no more deposits. If the bank pays 7% nominal interest, compounded semiannually, how much will be in your account after 3 years? Round your answer to the nearest cent. $
One year from today you must make a payment of $13,000. To prepare for this payment, you plan to make two equal quarterly deposits (at the end of Quarters 1 and 2) in a bank that pays 7% nominal interest compounded quarterly. How large must each of the two payments be? Round your answer to the nearest cent. $
REQUIRED LUMP SUM PAYMENT
Starting next year, you will need $20,000 annually for 4 years to complete your education. (One year from today you will withdraw the first $20,000.) Your uncle deposits an amount today in a bank paying 7% annual interest, which will provide the needed $20,000 payments.
How large must the deposit be? Round your answer to the nearest cent. $
How much will be in the account immediately after you make the first withdrawal? Round your answer to the nearest cent. $