Exam 4: Time Value of Money - Streams and Valuations

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Dan plans to fund his individual retirement account (IRA)with a maximum contribution of $2,000 at the end of each year for the next 10 years.If Dan can earn 10 percent on his contributions,how much will he have at the end of tenth year? (Round to the nearest whole dollar)

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You plan to retire at age 65.You want to withdraw $100,000 from your savings account every year starting on your 65 th birthday.You expect to make your final withdrawal on your 84th birthday.How much must you have accumulated by your 65 th birthday in order to support your desired withdrawals if you earn 3% on your savings?

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You have just taken out a 30-year mortgage on your new home for $120,000.This mortgage is to be repaid in 360 equal monthly installments.If the stated (nominal)annual interest rate is 14.75 percent,what is the amount of each of the monthly installments? Round to the nearest whole dollar.

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