A rich aunt has promised you $3,000 one year from today. In addition, each year after that, she has promised you a payment (on the anniversary of the last payment) that is 5% larger than the last payment. She will continue to show this generosity for 20 years, giving a total of 20 payments. If the interest rate is 5% , what is her promise worth today? The present value ----------
1. uppose you currently have $4,600 in your savings account, and your bank pays interest at a rate of 0.52% per month. If you make no further deposits or withdrawals, how much will you have in the account in 44 years? In 44 years' time, you will have $ ----------in the account
2. Suppose you currently have $5,000 in your savings account, and your bank pays interest at a rate of 0.5% per month. If you make no further deposits or withdrawals, how much will you have in the account in 55 years? In 55 years' time, you will have $------------ in the account
3. Your firm spends $5,000 every month on printing and mailing costs, sending statements to customers. If the interest rate is 0.5% per month, what is the present value of eliminating this cost by sending the statements electronically? This cost has a present value of ------------