FIN-210 Topic 3 Chapter 6 Financial Planning Problems Assignment

Chapter 6 Financial Planning Problems

Complete Problems 2, 3, 5, 6, 9, and 11 in Chapter 6 of the textbook.

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    2. Interest Earned. Lisa is depositing $2,500 in a six month CD that pays 4.25% interest. How much interest will she accrue if she holds the CD until maturity?

    3. Value of CD. Travis has invested $3,000 in a three month CD at 4%. How much will Travis have when the CD matures?

    5. T-bill Return. Troy paid $9,600 for a T-bill with a face value of $10,000. What is Troy’s return if he holds the T-bill to maturity?

    6. MMF Value. Bart is a college student who has never invested his funds. He has saved $1,000 and has decided to invest it in a money market fund with an expected return of 2.0%. Bart will need the money in one year. The MMF imposes fees that will cost Bart $20 at the time he withdraws his funds. How much money will Bart have in one year as a result of this investment?

    9. Annualized T-bill Rate. Brenda purchased a $30,000, 90-day T-bill for $29,550. What will Brenda’s return be when the T-bill matures? What will her annualized rate be?

    11. Investment Return. Thomas can invest $10,000 by purchasing a 1-year T-bill for $9,275, or he can place the $10,000 in a 12-month CD paying 8%. Which investment will provide a higher return? In addition to return, what else should Thomas consider when making his investment decision?

    Course: FIN-210 Personal Finance
    School: Grand Canyon University

    • 16/05/2021
    • 30
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