Week 2 Example 1- R = $50 I= 8.5%/2 + 0.085/2 + 0.0425 N= 15 X 2 = 30 A=? A= 50 x ((1-91 + 0.0425)-30) / 0.0425 = $838.95 The value of all the payments today equal $838.95. Example 2- S= ? R= $300 I=6%/4= 0.06/4 = 0.015 N= 4 x 4= 16 S= R x (((1+ I )n- 1) / i) S= 300 x (((1+ 0.015 )16- 1) / 0.015) = $5,379.71 At the end of 4 years josh will have $5,379.71 Example 4- A=$25,000 R= ? I=12% = 0.12 N= 5 R= A / ((1-(1+i)-n)/ i) R= 25,000 / ((1-(1+0.12)-5)/ o.14) = 6,935.24 S= 75,000 R= ? I= 8% = 0.08 N= 15 R= S/ ((( 1 + I )n- 1) / i)= 75000 / (((1 + 0.08)15- 1) / 0.08)= 2,762.22
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