Hello! Please, help with Brigham problems. i have few of them and would love to share with you and would be very happy if someone can help with solutions.
1) You want to accumulate $1mil by your retirement date, which is 25 years from now. You will make 25 deposits in your bank, with the first occurring today. The bank pays 8 % interest, compounded anuuallly. You expect to get annual raises of 3%, which will offset inflation, and you will let the amount you deposit each year also grow by 3% (you second deposit will be 3% greater than your first, the third will be 3% greater than the second, etc). How much must your deposit be if you are to meet your goal?
I have tried to do it with Goal Seek in Excel but I guess I chose wrong rates or some other mistakes.
2) Anne Lockwood, manager of Oaks Mall Jewlry, wants to sell on credit, giving customers 3 months to pay. However, Anne will have to borrow from her bank to carry the accounts receivable. The bank will charge a nominal rate of 15% and will compound monthly. Anne wants to quote a nominal rate to her customers (all of whom are expected to pay on time) that will exactly offset her finanncing costs. What nominal annual rate should she quote to here credit customers?
1) You want to accumulate $1mil by your retirement date, which is 25 years from now. You will make 25 deposits in your bank, with the first occurring today. The bank pays 8 % interest, compounded anuuallly. You expect to get annual raises of 3%, which will offset inflation, and you will let the amount you deposit each year also grow by 3% (you second deposit will be 3% greater than your first, the third will be 3% greater than the second, etc). How much must your deposit be if you are to meet your goal?
I have tried to do it with Goal Seek in Excel but I guess I chose wrong rates or some other mistakes.
2) Anne Lockwood, manager of Oaks Mall Jewlry, wants to sell on credit, giving customers 3 months to pay. However, Anne will have to borrow from her bank to carry the accounts receivable. The bank will charge a nominal rate of 15% and will compound monthly. Anne wants to quote a nominal rate to her customers (all of whom are expected to pay on time) that will exactly offset her finanncing costs. What nominal annual rate should she quote to here credit customers?