CLASS / COURSE: Business Algebra
Word Memo (100-150 words) & Spreadsheet
The purpose of this project is to summarize what you have learned from the material on linear equations and financial formulas. For additional assistance with this assignment, download the Step-by-Step Guide. **SEE ATTACHED**
As a financial planner, a client comes to you for investment advice. After meeting with him and understanding his needs, you offer him the following two investment options:
Option 1 (refer to section on Finite Mathematics in your text): Invest $5,000 in a savings account at 6.6% interest compounded monthly.
Option 2 (refer to section on Finite Mathematics in your text): Invest into an ordinary annuity where $1,100 is deposited each year into an account that earns 4.8% interest compounded annually.
Set up the formula for compound interest for Option 1 and the formula for Future Value of an Annuity for Option 2 in an Excel spreadsheet to calculate the amount earned at the end of 6 years. Be sure to label all variables in your spreadsheet.
After creating the spreadsheet with the two different investment options, write a memo that addresses the following points for your client:
Explain to your client what compound interest is.
Explain to your client what an annuity is.
From the calculations in the Excel spreadsheet for Option 1 and Option 2, explain which investment option is better for your client and why.
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Completed Solution is attached. Click on Buy button and then download file to get full solution.
SUBJECTS / CATEGORIES:
4. Quantitative Techniques
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