Author Question: In five years your oldest child will be in 8th grade, at which point you and your family plan to ... (Read 31 times)

cdr_15 · **on:** Jul 10, 2018

In five years your oldest child will be in 8th grade, at which point you and your family plan to vacation in Europe. You estimate that you will need 20,000 for the trip.

How much do you need to set aside today if you can place your money in an investment vehicle earning an average of 4.50 per year?
A) 14,961
B) 15,073
C) 16,049
D) 16,058

Question 2

The school district needs to pass a bond levy for funding to remodel existing schools and to build new schools. Expenditures for the new and remodeled buildings will begin 18 months after passage of the bond.

If the school district receives all funding immediately after the passage of the bond and can invest the funds at a rate of 3.75 per year, how large must the bond be for the district to have 45,000,000 at the start of construction?
A) 45,000,000
B) 47,554,834
C) 42,556,397
D) 42,582,422

s.meritte · **Reply #1 on:** Jul 10, 2018

Answer to Question 1

Answer: C
Explanation: C) PV = = = 16,049.02
MODE = END
INPUT 5 4.5 ? 0 -20,000
KEY N I/Y PV PMT FV
CPT 16,049.02

Answer to Question 2

Answer: D
Explanation: D) PV = = = 42,582,421.62
MODE = END
INPUT 1.5 3.75 ? 0 -45,000,000
KEY N I/Y PV PMT FV
CPT 42,585,421.62