Question

Your wealthy uncle established a bank account with $2,400 for you when you were born. For the first 9 years of

your life, the interest rate earned on the account was 4%. Since then, rates have been only 2%. Now you are 23 years old and ready to cash in. How much is in your account? (Do not round intermediate calculations. Round your answer to 2 decimal places.)

If you earn 8% per year on your bank account, how long will it take an account with $105 to double to $210? (Do not round intermediate calculations. Round your answer to 2 decimal places.)

What is the present value of the following cash-flow stream if the interest rate is 6%? (Do not round intermediate calculations. Round your answer to 2 decimal places.)

Year Cash Flow

1 $290

2 490 

3 390 

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