Finance Assignment | Professional Writing
4. (10 points) Having received a large inheritance, Nancy’s parents wish to establish a trust fund for her college education. Seven years from now, they need an estimated $120,000. How much should they set aside in trust now if they invest the money at 5.75%/year compounded quarterly? (Round your answer to the nearest dollar.) 5. (10 points) Laura has a trust fund from her grandfather which pays her $300 at the end of each month. Since she doesn’t need the money to live on, she is depositing it in a savings account paying 4.75% interest per year compounded monthly. How much will she have in six years?
(Round your answer to the nearest dollar.) 6. (10 points) ABC Company has an immediate need for a loan. In an agreement worked out with its banker, ABC has agreed to pay the bank $4800/month for the next three years, with the first payment due at the end of the first month. If the bank charges interest at the rate of 3.50%/year compounded monthly, what is the amount of the loan negotiated between ABC and its banker? (Round your answer to the nearest dollar.)
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