The Mathematics of Money

162 Chapter 4 Annuities Suppose that Ron deposits $125 per month into an account paying 8%. His brother Don deposits $250 per m ...

Copyright © 2008, The McGraw-Hill Companies, Inc. 4.3 Sinking Funds So far we have looked at annuities from the point of view th ...

164 Chapter 4 Annuities Sinking Funds with Loans Knowing that her company had a large expense ahead on the horizon, it was prude ...

Copyright © 2008, The McGraw-Hill Companies, Inc. Of course, given the size of the deposits involved, the district would most li ...

166 Chapter 4 Annuities Example 4.3.5 For the scenario of the previous example, determine how much total interest Joe would be e ...

Copyright © 2008, The McGraw-Hill Companies, Inc. Find the quarterly payment needed to accumulate $30,000 in 8 years, assuming ...

Find the monthly sinking fund payment needed to accumulate $5,000 in 3 years, assuming a 6.1% interest rate. Kinzua County borr ...

Copyright © 2008, The McGraw-Hill Companies, Inc. FORMULA 4.4.2 The Present Value of an Annuity Due PV
PMT a _n|i (1i) Findin ...

170 Chapter 4 Annuities For convenience’s sake, when a table is used in situations such as these, the columns will often be labe ...

Copyright © 2008, The McGraw-Hill Companies, Inc. Now, let’s make a few changes to the scenario described above. Suppose that in ...

172 Chapter 4 Annuities FORMULA 4.4.3 The Present Value Annuity Factor a _n|i
s _n|i ___(1  i) (^) n Example 4.4.4 Use Formul ...

Copyright © 2008, The McGraw-Hill Companies, Inc. and then replace s _n (^) |i with its formula, we get: a n (^) |i
(1  i)n  ...

174 Chapter 4 Annuities For entry in the calculator, once again your best bet is to calculate the future value factor however yo ...

Copyright © 2008, The McGraw-Hill Companies, Inc. Since this is a 30-year loan with monthly payments, n
(30)(12)
360 and i
...

176 Chapter 4 Annuities This payment includes both principal and interest, but doesn’t reveal how much goes to each category. To ...

PV
PMT a _n (^) | (^) i $557,893
PMT a _ 240 | (^) .00375 $557,893
PMT(158.065436810) PMT
$3,529.51 So Charlie’s account ...

178 Chapter 4 Annuities INTEREST RATE Years 7.0% 7.5% 8.0% 8.5% 9.0% 15 111.255958 107.873427 104.640592 101.549693 98.5934088 3 ...

Copyright © 2008, The McGraw-Hill Companies, Inc. Find a ___ 360 | (^) 0.00725. For each of Exercises 13 to 17: a) Find n. b) ...

180 Chapter 4 Annuities A company knows that it will need to pay $750,000 each year for the next 10 years to clean up toxic pol ...

Copyright © 2008, The McGraw-Hill Companies, Inc. b. Not only do shorter terms save you money by paying off the loan more quickl ...