If your grandma said you could have $5,000 when you graduate from college in four years, what is that money worth today? Calculate your answer when the real interest rate is 3%, 5%, and 10%

Answers

Answer 1

Answer:

This question relates to Present Value.

Real Interest rate is 3%;

= Principal / (1 + rate) ^ number of years

= 5,000 / ( 1 + 3%)⁴

= $4,442.44

Real Interest rate is 5%;

=  5,000 / ( 1 + 5%)⁴

= $4,113.51

Real Interest rate is 10%;

= 5,000 / ( 1 + 10%)⁴

= $3,415.07

Answer 2

The worth of the money my grandma would give me when real interest rate is 3% is $4,442.44.

The worth of the money my grandma would give me when real interest rate is 5% is $4,113.51.

The worth of the money my grandma would give me when real interest rate is 10% is $3415.07.

What is the worth of the money today?

In order to determine the worth of the money today, the present value has to be determined. Present value is the sum of discounted cash flows.

Present value when real interest rate is 3% = $5000 / (1.03^4) = $4,442.44

Present value when real interest rate is 5% = $5000 / (1.05^4) = $4,113.51

Present value when real interest rate is 10% = $5000 / (1.1^4) = $3415.07

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Answer:

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Explanation:

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Answers

Answer:

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Explanation:

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Answers

Answer:

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Answer:

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Answer:

Indeed, federalism increases public participation in politics, as it grants political representation to the different territorial subdivisions of a given nation, both in the local order and in the state order.

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Answer:

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Explanation:

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Answer:

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Explanation:

Answer:

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Explanation:

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Answer:

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Answer:

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Answer:

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Explanation:

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Answer:

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Explanation:

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Answers

Answer:

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Answers

Answer:

[tex]\boxed {\boxed {\sf Southern \ colonies}}[/tex]

Explanation:

The New England Colonies had to rely on a maritime economy. The harsh environment with rocky soil just wasn't fit to farm. They had to trade furs, fish, build ships and raise livestock.

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b
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d

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Answers

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Answers

Answer:

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Answer:

quaternary sector

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Explanation:

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quaternary

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Answer:

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Answers

Answer:

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