# You have $16,000 you want to invest for the next 32 years. You are offered an investment plan...

## Question:

You have $16,000 you want to invest for the next 32 years. You are offered an investment plan that will pay you 8% per year for the next 16 years and 12% per year for the last 16 years. How much will you have at the end of the 32 years? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.)

If the investment plan pays you 12% per year for the first 16 years and 8% per year for the next 16 years, how much will you have at the end of the 32 years? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.)

## The Power of Compounding:

An investment earns a compounding return when return accrues not only on the initial investment, but also on the accrued returns over time. With a compound return, the total value of the investment increases exponentially over time.

## Answer and Explanation: 1

Become a Study.com member to unlock this answer! Create your account

View this answerWe can use the following formula to compute the future value of an asset with current value {eq}V_0 {/eq}, period return {eq}r{/eq}, after ...

See full answer below.

#### Ask a question

Our experts can answer your tough homework and study questions.

Ask a question Ask a question#### Search Answers

#### Learn more about this topic:

from

Chapter 5 / Lesson 16Understand the definition of future value and the future value formula. Explore some examples that show how to calculate the future value of an investment.

#### Related to this Question

- You have $17,500 you want to invest for the next 40 years. You are offered an investment plan that will pay you 6% per year for the next 20 years and 10% per year for the last 20 years. How much will
- You have $20,000 you want to invest for the next 40 years. You are offered an investment plan that will pay you 7% per year for the next 20 years and 11% per year for the last 20 years. a. How much w
- You have $18,500 you want to invest for the next 32 years. You are offered an investment plan that will pay you 6 percent per year for the next 16 years and 10 percent per year for the last 16 years. a. How much will you have at the end of the 32 years?
- You have $18,750 you want to invest for the next 30 years. You are offered an investment plan that will pay you 9 per cent per year for the next 15 years and 13 per cent per year for the last 15 years
- You have $18,500 you want to invest for the next 32 years. You are offered an investment plan that will pay you 6 percent per year for the next 16 years and 10 percent per year for the last 16 years.
- You have $19,500 you want to invest for the next 24 years. You are offered an investment plan that will pay you 6 percent per year for the next 12 years and 10 percent per year for the last 12 years.
- You have $20,000 you want to invest for the next 40 years. You are offered an investment plan that will pay you 7 percent per year for the next 20 years and 11 percent per year for the last 20 years.
- You have $5,000 you want to invest for the next 45 years. You are offered an investment plan that will pay you 6 percent per year for the next 15 years and 10 percent per year for the last 30 years.
- You have $4,000 to invest for the next 45 years. You are offered an investment plan that will pay you 5% per year for the next 10 years and 12% per year for the last 35 years. How much will you have a
- You have $15,750 you want to invest for the next 34 years. You are offered an investment plan that will pay you 9% per year for the next 17 years and 13% per year for the last 17 years. How much will
- You have $20,000 you want to invest for the next 40 years. You are offered an investment plan that will pay you 7% per year for the next 20 years and 11% per year for the last 20 years. How much will you have at the end of 40 years? Does it matter if the
- You have $18,500 you want to invest for the next 32 years. You are offered an investment plan that will pay you 6% per year for the next 16 years and 10 percent per year for the last 16 years. a. How much will you have at the end of the 32 years? b. If t
- You have $19,750 you want to invest for the next 22 years You are offered an investment plan that will pay you 9 percent per year for the next 11 years and 13 percent per year for the last 11 years. 1: How much will you have at the end of the 22 years? 2
- You want to invest your savings of $20,000 in government securities for the next 2 years. Currently, you can invest either in a security that pays interest of 8% per year for the next 2 years or in a
- You want to accumulate $100,000 by saving $8,000 at the end of each of the next 10 years. At what interest rate must you invest to meet your goal?
- You want to accumulate $100,000 by saving $3,000 at the end of each of the next 10 years. At what interest rate must you invest to meet your goal?
- You want to accumulate $50,000 by saving $3,000 at the end of each of the next 10 years. At what interest rate must you invest to meet your goal?
- What would you be willing to pay today for the following investments? a. Pay $5,000 per month for the next 15 years if the rate is 3.5% b. Pay $1,000 per year for the next 20 years and addition give a
- You are planning on retiring for retirement 34 years from now. You plan to invest $4,200 per year for the first 7 years, $6,900 per year for the next 11 years, and $14,500 per year for the following 1
- Please explain step by step how to solve this problem. You have $19,250 you want to invest for the next 26 years. You are offered an investment plan that will pay you 7 percent per year for the next
- You are planning for retirement 34 years from now. You plan to invest $4,200 per year for the first 7 years, $6.900 per year for the next 11 years, and $14,500 per year for the following 16 years (ass
- 1. You are planning for retirement 34 years from now. You plan to invest $4,200 per year for the first 7 years, $6,900 per year for the next 11 years, and $14,500 per year for the following 16 years (
- You will receive over the next ten years the following payment: $500 each year for years 1-5 and $1000 per year for years 6-10. If you can invest the money at 10% how much money will you have in the year 20? A. 13,351 B. 28,586 C. 16,947 D. 14,526
- You want to invest your savings of $30,000 in government securities for the next 2 years. Currently, you can invest either in security that pays interest of 8.4 percent per year for the next 2 years or in security that matures in 1 year but pays only 5.8
- You want to accumulate enough money over the next 10 years to pay for your son s college. The total costs in 10 years are expected to be $200,000 that you want to pay in advance before the first semester. You currently have $10,000 that you plan to invest
- You are going to retire 30 years from now and plan to live for another 25 years. You can earn 8% on your investment for the next 55 years. You just deposited $15,000 into the investment account. You w
- You want to invest money for 3 years in an account that pays 7 percent interest annually. How much would you need to invest today to reach a future goal of $5,000? a. $4,650.00 b. $4,762.90 c. $6,125.22 d. $4,081.49
- You invest in a scheme that will pay you $4000 at the end of each of the next six years, plus a lump sum payment of $40,000 when the six years are up. If this scheme boasts a 15% APR (annual percentag
- You want to save $75 a month or the next 15 years and hope to earn an average rate of return of 14%. How much more will you have to have at the end of the 15 years if you invest your money at the begi
- You expect to receive $3,000 in 3 years (i.e., end of year 3). Then you plan to invest it earning 5% per year. What will you have at the end of year 8?
- You plan to invest $2,000 every year (end-of-year payments) from now until you retire in 30 years. If you can earn 7% annually on your invested funds, how much will you have when you retire?
- You want to start saving for retirement. If you deposit $2,000 at the end of each year for the next 60 years and earn an 11% annual rate of return on the investment, how much will you have when you retire?
- You plan to save $200 a month for the next 24 years and hope to earn an average rate of return of 10.6 percent. How much more will you have at the end of the 24 years if you invest your money at the b
- Investment X offers to pay you $3,700 every year for the next nine years, whereas investment Y offers to pay you $5,500 per year for the next five years. If the interest rate is 6%, which investment h
- You have been offered an investment that will pay you 9 percent per year. If you invest $15,000, how long until you have $30,000?
- You plan to save $1,400 for the next four years, beginning now, to pay for a vacation. If you can invest it at 6 percent, how much will you have at the end of four years?
- (1) You want to accumulate $1,000,000 over the next 10 years. You intend to do this by making deposits of X into an investment account at the end of each month, for 30 years. The account earns i (4) =
- A young couple wants to have a college fund that will pay $40,000 at the end of each half-year for 8 years. a) If they can invest at 9%, compounded semiannually, how much do they need to invest at the end of each 6-month period for the next 19 years in o
- You expect to receive $10,000 in two years. You plan on investing it at 11% until you have $75,000. How long will you wait from now?
- You plan to invest $20,000 today and you can earn 7% per year on the money. How long will it take for your investment to grow to $100,000?
- You are interested in investing a $15,000 gift from your grandparents for the next five years in a mutual fund that will earn an annual return of 6%. What will your investment be worth at the end of five years?
- You are interested in investing a $15,000 gift from your grandparents for the next 10 years in a mutual fund that will earn an annual return of 7%. What will your investment be worth at the end of 10 years?
- You are interested in investing a $15,000 gift from your grandparents for the next four years in a mutual fund that will earn an annual return of 8%. What will your investment be worth at the end of four years?
- You want to start saving for retirement. If you deposit $2,000 at the beginning of each year for the next 60 years and earn an 11% annual rate of return on the investment, how much will you have when you retire?
- You expect to receive $10,000 at graduation in two years. You plan on investing it at 8 percent until you have $105,000. How long will you wait from now? a) 30.55 years b) 35.81 years c) 36.46 years d) 28.55 years e) 32.55 years
- Suppose you want to have $2,000,000 when you retire in 30 years. Assume you will earn 8% per year on your investments. How much would you have to invest at the end of each year for the next 30 years to reach your $2,000,000 goal?
- You are valuing an investment that will pay you $26,000 per year for the first 9 years, $34,000 per year for the next 11 years, and $47,000 year the following 14 years (all payments are the end of eac
- You plan to work for the next 39 years and earn 6.5% on your investments during your working years. In retirement, you expect to need $82,000 per year during each of your 25 years of retirement and (d
- Your plan is to raise $100,000 as quickly as possible. If you decide to invest $5,000 at the end of each of the next several years at 4 % interest compounded annually, how long will it take you to reach your goal?
- You invest a single amount of $10,000 for 5 years at 10%. At the end of 5 years, you take the proceeds and invest them for 12 years at 15%. How much will you have after 17 years?
- Use Excel. You are planning for retirement 34 years from now. You plan to invest $4,200 per year for the first 7 years, $6,900 per year for the next 11 years, and $14,500 per year for the following 16
- A young couple wants to have a college fund that will pay $25,000 at the end of each half-year for 8 years. (a) If they can invest at 7%, compounded semiannually, how much do they need to invest at t
- A young couple wants to have a college fund that will pay $20,000 at the end of each half-year for 8 years. a) If they can invest at 9%, compounded semiannually, how much do they need to invest at the
- You expect to earn 8% per year on your investment. If you invest $3,000 today, how much will your investment be worth in 9 years?
- You want to accumulate $50,000 by saving $3,000 at the end of each of the next 10 years. At what interest rate must you meet your goal?
- If you want to quadruple your initial investment of $1,000 in six years, at what rate should you invest your money?
- You expect to receive $16,000 at graduation in two years. You plan on investing it at 8 percent until you have $100,000. How long will you wait from now? A. 28.91 years B. 25.81 years C. 21.81 years
- You expect to receive $11,000 at graduation in two years. You plan on investing at 12 percent until you have $97,000. How long will you wait from now? a. 17.21 years b. 23.75 years c. 23.33 years d. 21.21 years e. 19.21 years
- You are offered an investment that will pay you $7,184 every year for 27 years. If you require a 7.9% return on investments with the same levels of risk, how much are you willing to invest today?
- You are being offered an investment that will pay you (and your heirs) $16,964 per year forever, starting 11 years from now. If your discount rate on this investment is 8.6%, how much would you be wil
- Suppose you have an option to invest 15000 for the next 25 years in an account that earns 5% per year or investment 15000 that returns 3x your investment after 25 years. which option would you take?
- You can buy a security for $1,000. It is expected to pay you $80 at the end of each of the next 3 years, then to pay you $1,080 at the end of the 4th year. What is the expected annual rate of return o
- Suppose you have an option to invest $15,000 for next 25 years in an account that earns 5% per annum or invest $15,000 in a scheme that returns 3 times your investment after 25 years. Which option sho
- You are considering an investment that will pay you $1,428 in one year, $2,033 in two years, and $3,947 in three years. If you want to earn 12% of your money, how much will you be willing to pay?
- If you invest $500 at the end of each year in a mutual fund earning an average 9% after-tax, what will it grow to in 30 years?
- If you invest $1,000,000 today, how long will it take the money to become worth $5,000,000 if you earn 11% on your investments? A) 15.42 years B) There is no solution to this problem C) 16.80 years D)
- You expect an investment to return $11,300, $14,600, $21,900, and $38,400 annually over the next four years, respectively. What is this investment worth to you today if you desire a rate of return of
- You are considering the purchase of an investment that would pay you $5000 per year for years 1-5, 3000 per year for years 6-8, and 2000 per year for years 9 and 10. If you require a 14% rate of retur
- You want $100,000 after eight years in order to start a business. Currently you have $22,000, which may be invested to earn 7 percent annually. How much additional money must you set aside each year i
- I am planning on investing in retirement. I estimate that I will need $100,000 per year for twenty years. I expect to earn 7% while accumulating and 3% in retirement. I am now 25 expecting to retire at 70 and have nothing in the plan yet, and from this ye
- I am planning on investing for retirement. I estimate that I will need $100,000 per year for twenty years. I expect to earn 6% while accumulating and 4% in retirement.. I am now 25 expecting to retire at 67 and have nothing in the plan yet, and from this
- You want to have $5 million when you retire in 40 years. You believe you can earn 9 percent per year on your investment. How much must you invest each year to achieve your goal when you retire? (Ignore all taxes.)
- You want have $5 million when you retire in 40 years. You believe you can earn 9 percent per year on your investment. How much must you invest each year to achieve your goal when you retire?
- You deposit $7500 annually into a life insurance fund for the next 20 years, at which time you plan to retire. Instead of a lump sum, you wish to receive annuities for the next 20 years. What is the a
- If you were offered an investment that will pay you $10,698 every year forever, and you require an 10.1% return on investments with the same levels of risk, how much are you willing to invest today?
- Suppose that the pension fund you are managing is expecting an inflow of funds of $15 million next year and you want to make sure that you will earn the current interest rate of 6% when you invest the
- Consider a house = $125,000. If you want to buy this house in 10 years, it is expected to increase 5% a year over a 10 year period, assuming you can earn 10% annually on investment. How much should yo
- You want to retire in 10 years. You can earn 8% APR on your investments. If you save $500 per month (first payment today), what is the future value of your investment?
- You have to opportunity to get a check for $1 million 50 years from now, or get an annual check for $2,000 for the next 50 years. Which should you choose if you knew you could earn 7.5% on invested fu
- Suppose that the pension fund you are managing is expecting an inflow of funds of $100 million next year and you want to make sure that you will earn the current interest rate of 8% when you invest th
- You are planning to put $1,500 in the bank at the end of each year for the next nine years in hopes that you will have enough money for a trip around the world. If you are investing at an annual interest rate of 4%, you'll have accumulated __________ at t
- You expect to receive $15,000 at graduation two years from now. You plan on investing it at 5% compounded monthly until you have $80,000. How long will you have to wait?
- You expect to receive $17,000 at graduation in two years. You plan on investing it at 11 percent until you have $102,000. How long will you want from now? A. 19.17 years B. 21.09 years C. 21.47 years D. 15.17 years E. 17.17 years
- I want to invest a lumpsum of rs. 50000 in ICICI value discovery fund for a period of more than 20 years. Is this a right choice?
- I want to invest ?5000/month in an SIP for 3-5 years. Which SIP plan should I go for? Which will be the best option for a safe and secure higher interest rate?
- Assume you have $10,000 that you plan to invest for 5 years. How much more would you have if you invested the funds at 8% with annual compounded interest versus 8% with simple interest? No funds will be paid until the end of the fifth year.
- You expect to receive $5,000 at graduation in 2 years. You plan on investing this money at 9% until you have $75,000. How many years from today will it be until this occurs? a. 33.42 years b. 29.08 y
- You want to be a millionaire when you retire in 45 years. If you earn an annual return of 8%, how much do you have to invest today?
- You expect to receive $20,000 at graduation one year from now. You plan on investing it at 6% simple interest per year until you have $100,000. How long will you have to wait?
- You invest a single amount of $10,000 for 5 years at 10 percent. At the end of 5 years you take the proceeds and invest them for 12 years at 15 percent. How much will you have after 17 years?
- You invest $1,575 at the beginning of every year and your friend invests $1,575 at the end of every year. If you both earn an annual rate of return of 8.9%, how much will each of you have in your account after 19 years?
- You've been offered an investment that will pay you 7% per year. If you invest $10,000, how long does it takes until you have $20,000? How long until you have $30,000?
- If you invest $5,000 today, you will receive $1,000 in a year, $1,500 each in year 2 and year 3, and $2,000 each in year 4 and year 5. If you require a 10% annual return, should you take the investment?
- You expect to receive $20,000 at graduation one year from now. You plan on investing it at 5% compounded annually until you have $100,000. How long will you have to wait?
- You are scheduled to receive $6,000 in two years. When you receive it, you will invest it at 7.5 percent per year. How much will your investment be worth 8 years from now?
- You are scheduled to receive $14,000 in two years. When you receive it, you will invest it at 5.5 percent per year. How much will your investment be worth 10 years from now?
- 1. You are scheduled to receive $7,500 in two years. When you receive it, you will invest it at 4.5 percent per year. How much will your investment be worth ten years from now? |$10,665.75 |$11,428.
- You are considering the purchase of an investment that would pay you $38 per year for Years 1-4, $79 per year for Years 5-7, and $43 per year for Years 8-10. If you require a 14% rate of return, and t
- You plan to invest $2,000 in an individual retirement arrangement (IRA) today at a nominal annual rate of 8%, which is expected to apply to all future years. How much will you have in the account at the end of 10 years if the interest is compounded annual