Questions from Business Mathematics

Q: Rino has just purchased a five-year term life insurance policy

Rino has just purchased a five-year term life insurance policy. For his premium payments, Rino can choose either beginning-of-month payments of $38.50 or beginning-of-year payments of $455. In current...

Q: Beaudoin Haulage has signed a five-year lease with GMAC on

Beaudoin Haulage has signed a five-year lease with GMAC on a new dump truck. Beaudoin intends to capitalize the lease and report it as a long-term liability. Lease payments of $2700 are made at the be...

Q: In order to accumulate $750,000 after 25 years,

In order to accumulate $750,000 after 25 years, calculate the amounts that must be invested at the beginning of each year if the invested funds earn: 1. 3% compounded annually. 2. 6% compounded annual...

Q: To accumulate $200,000 after 20 years, what amount

To accumulate $200,000 after 20 years, what amount must be invested each year if the investment earns 9% compounded annually and the contributions are made: 1. At the beginning of each year? 2. At the...

Q: What maximum annual withdrawals will a $200,000 fund earning

What maximum annual withdrawals will a $200,000 fund earning 6% compounded annually sustain for 20 years if the withdrawals are made: 1. At the beginning of each year? 2. At the end of each year?

Q: Triex Manufacturing wants to accumulate $500,000 for an expansion

Triex Manufacturing wants to accumulate $500,000 for an expansion planned to begin in five years. If today Triex makes the first of equal quarterly payments into a fund earning 5.4% compounded monthly...

Q: Felix has already accumulated $20,000 and plans to invest

Felix has already accumulated $20,000 and plans to invest another $5000 at the beginning of each year for the next 15 years. He expects to earn a return of 7 1 4 % compounded annually on his investmen...

Q: An insurance company wishes to offer customers a monthly installment alternative to

An insurance company wishes to offer customers a monthly installment alternative to the annual premium plan. All premiums are payable at the beginning of the period of coverage. The monthly payment pl...

Q: Advance Leasing calculates the monthly payments on its three-year leases

Advance Leasing calculates the monthly payments on its three-year leases on the basis of recovering the capital cost of the leased equipment and earning a 13.5% compounded monthly rate of return on it...

Q: Shane is about to have his 25th birthday. He has set

Shane is about to have his 25th birthday. He has set a goal of retiring at age 55 with $700,000 in an RRSP. For planning purposes he is assuming that his RRSP will earn 8% compounded annually. 1. What...