Mr. Smith has just invested

$10,000 for his son (age 7). The money will be used for his son's education 15

years from now. He calculates that he will need $100,000 for his son's

education by the time the boy goes to school. What rate of return will Dr. Stein

need to achieve this goal? 

Ian would like to save

$2,000,000 by the time he retires in 40 years. If he believes that he can

achieve a 7% rate of return, how much does he need to deposit each year to

achieve his goal? 

Sara would like to

evaluate the performance of her portfolio over the past 10 years. What compound

annual rate of return has she achieved if she invested $12,000 10 years ago and

now has $25,000? 

After 10 years, 100 shares

of stock originally purchased for $500 was sold for $900. What was the yield on

the investment?

Sydney saved $10,000 during

her first year of work after college and plans to invest it for her retirement

in 40 years. How much will she have available for retirement if she can make 8%

on her investment? 

Dan would like to save

$1,500,000 by the time he retires in 25 years and believes he can earn an

annual return of 8%. How much does he need to invest in each of the following

years to achieve his goal? 

Luke believes that he can

invest $5,000 per year for his retirement in 30 years. How much will he have

available for retirement if he can earn 8% on his investment? 

If Gerry makes a deposit of

$1,500 at the end of each quarter for 5 years, how much will he have at the end

of the 5 years assuming a 12% annual return and quarterly compounding? 

Carol Thomas will pay out

$6,000 at the end of the year 2, $8,000 at the end of year 3, and receive

$10,000 at the end of year 4. With an interest rate of 13 percent, what is the

net value of the payments vs. receipts in today's dollars? 

7. 

Mr. Fish wants to build a

house in 8 years. He estimates that the total cost will be $150,000. If he can

put aside $10,000 at the end of each year, what rate of return must he earn in

order to have the amount needed?