Annuity Due
Word Problems
1. How much money must bartley invest at the beginning of each quarter if he wishes to receive 150,000 six years from now? Assume that the first payment starts now and the interest rate is 7%
2. A house that sells for 900,000 can be purchased nder terms requiring 100 monthly payments. Assume that the first payment begins now and the interest is 12% compounded monthly. What is the size of each monthly payment?
3. What is the nominal rate compounded semiannually will an annuity due of 5,000, payable at the beginning of every six months for ten years, amount to 127,720?
4. What is the nominal rate compounded annually if the present value of an annuity dur of 8,000, payable at the begging of each year for eight years is 53,000?
5. If 6,000 is deposited at the beginning of each month at 9% compounded monthly, how many months will be needed for the deposits to amount to at least 300,000?
6. if the present value of an annuity due of 2,000 payable semiannually is 28,000 and interest is computed at 6% compounded semiannually, what is the number of payments?
Please give solutions with explanations for understandability