a) Determine the present value on January 1, 2000, of payments of $200 every 6 months from January 1, 2000, through January 1, 2004, inclusive, and $100 every 6 months from July 1, 2004, through January 1, 2010, inclusive, if i = .06.
I think it might be something like: 100(a angle 8)(0.03) + 100(a angle 20)(0.03) which equals 100((1 - v^8)/0.03) + 100((1 - v^20)/0.03) , v=1/1.03
But the answer is $2,389.72 which is way off from what I'm getting. Am I even close?
b) At the beginning of the year Kelly establishes a fund with a deposit of $1000. At the beginning of each month a health club withdraws a $24 fee. The fund earns a nominal rate of interest of 18% compounded monthly. Determine the amount in the fund at the end of the year.
The only way I can think to do this is calculating each month separately so I know there's a faster way ... Any suggestions?