1) The GAMMA Corp. has decided to enter the next generation in customer service. In order to do so they need to purchase a new piece of equipment. The equipment is highly specialized and needs to be created to exact specifications. As a result it will take at least 30 months for the equipment to be ready for installation and will cost a total of $270,000. GAMMA Corp. wants to set aside the money it needs for the equipment today. Being extremely conservative the company will be placing the funds it needs for the purchase into a GIC with a rate of 2.1% compounded Semi-Annually.
A- How much money are they setting aside today?
B- What would the interest rate be if they only needed to save $221,920.32 at the beginning? (Input as a percentage without the % sign)(Remember (-) where appropriate)
C -How much would they need if they had more time to allow money to grow such as if the equipment would be ready in 5.5 Years at a rate of 2.1% Compounded Semi-Annually?
2) Jane is an analyst and their company wants to get a return of atleast 4.4% compounded Quarterly on their investment. Jane will only have use of the money for 12 Months before the company needs it for another project. Jane has been give $1,200 to invest.
A- If Jane is able to find an investment matching the criteria, how much money will they have after 12 Months?
B- If the rate of return ended up being 11.5% and the company invested their $1,200. How much would they have after 12 Months?
C- The company liked the 11.5% and decided to leave the money invest until they earned 6,573.13. How long was the money actually invested for in MONTHS? (REMEMBER (-) signs where appropriate).