Finance

If an investment of $5,000 today earns 5% in each of the next five years, and then earns 7% per year for five years after that, how much will the investment be worth at the end of the ten years?

asked by help w/ business
  1. Is the interest compounded?

    Compounded daily, quarterly, yearly, etc ?

    posted by helper
  2. It doesn't indicate

    posted by help w/ business
  3. $5,000 @ 5% for 5 yrs
    then 7% for 5 yrs

    I = PRT
    I = 5000(0.05)(5)
    I = 250(5)
    I = 1250.00

    5000 + 1250.00 = 6250.00

    I = PRT
    I = 6250(0.07)(5)
    I = 437.50(5)
    I = 2187.50

    6250.00 + 2187.50 = 8437.50

    posted by helper

Respond to this Question

First Name

Your Answer

Similar Questions

  1. Trigonometry

    The value V, of a $100,000 investment that earns 3% annual interest is given by V=f(t) where t is in years. How much is the investment worth in 3 years
  2. finance

    Mrs. Kay who is 24 years old plans to retire at the age of 60. Mrs. Kay would like to be able to withdraw $120,000 per year from her retirement account for 40 years after retirement beginning a year after her retirement. She
  3. Math

    A Registered Education Savings Plan (RESP) earns interest at a rate of 5% per year, compounded annually. Jasmine’s parents invest $4000 in the account today. a) Determine an explicit formula to represent the value of the
  4. Maths B

    Kate is thinking about investing $45000 for 5 years. She deposits her money into an account which earns interest paid quarterly at a rate of 3.99% p.a. After 1½ years, Kate withdraws her investment (including interest) and
  5. financial management

    a) An investment gives you $10,000 from years 1 through 4 and 40,000 in year 5. If the interest rate is 7.5%, what is the present worth of this investment? (2 points) b)You need $150,000 to buy a new car in 5 years’ time. How
  6. Algebra

    Two investments in high- technology companies total $1,100. If one investment earns 10% annual interest and the other earns 10%, find the amount of each investment of the total interest earned is $140 for the year. The value of
  7. Algebra

    An investment grows according to the exponential equation y = 15,000 · 1.07x, where x is the number of years invested. Which of the following statements is true? A. The investment will continue to grow at a rate of 7% per year
  8. math

    Your invest $3,000 annually in a mutual fund that earns 10 percent annually and you invest all distributors. How much will you have in the account at the end of 20 years? You invest $3,000 annually in a mutual fund with a 5
  9. Finance

    A company has identified the following investments as looking promising. Each requires an initial investment of $1.2 million. Which is the best investment?Question 4 options: A) a perpetuity that generates a cash flow at the end
  10. Finance

    Alphonse Inc. is thinking about investing in an annuity contract that will return $100,000 annually at the end of each year for 15 years. What amount should Alphonse pay for this investment if it earns an 6% return?

More Similar Questions