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Janice plans to retire in 10 years and would like to receive $3000.00 per month for fifteen years ...

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jake:
Question 1If a loan was repaid by ordinary yearly payments of $2000.00 in five years at 9.00%, compounded yearly, how much interest was paid?

Question 2Janice plans to retire in 10 years and would like to receive $3000.00 per month for fifteen years starting at the end of the first month after her retirement. Calculate the amount she must invest now if interest is 7.5% compounded monthly.

smrerig:
Answer 1PVn = 2000.00 = 2000.00(3.88965126) = $7779.30
Interest: 2000.00(5) -7779.30 = 10000.00 -7779.30 = $2220.70

Answer 2Step 1: PMT = 3000.00; n = 15(12) = 180; I/Y = 7.5; P/Y = C/Y = 12; i = = 0.625% = 0.00625
PV = PMT = 3000 = $323 620.28
Step 2: FV = 323620.28; n = 10(12) = 120 PV = 323620.28(1.00625)-120 = $153 224.61

Programmed solution:

christoph.camposo@outlook:
Thank you

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