#1. What do we mean by the “time value of money” and why is this concept important to making business decisions? #2. What is the difference between Present Value and Future Value? Provide examples. #3. a. Find the Future Value 2 year(s) from now of an investment of $447 today if the interest rate is

13. The future value of $200 received today and deposited for three years in an account which pays semiannual interest of 8 percent is ______. A. $253.00 B. $252.00 C. $158.00 D. $134.66 14. The future value of $100 received today and deposited at 6 percent for four years is A. $126. B. $ 79.

Ling opened an annuity to save for a down payment on a home. The annuity was created with an initial deposit of $3,500 (end of year). At the end of each of the following ten years, a payment of $4000 is made into the annuity. The interest rate is 2% compounded annually. a) Compute the

1/ You won the lottery and will receive $50,000 per yr for 20 yrs. Assume 4% interest used to evaluate annuity and you receive pymt at the begining of the yr a/ what is the PV of the lottery b/ how much interest was earned on the PV to make $50,000 a year pymt. 2/

3. Another client, Wynona, decides that she will invest $5,000 per year in a 6% annuity for the first ten years, then $6,000 for the next ten years, and then $4,000 per year for the last ten years, how much will she accumulate? [Hint: Treat each ten-year period as as separate annuity and compute the

Barb and John Reed want to know how much they must deposit in a retirement savings account today to have payments of $1,750 every six months for 15 years. The retirement account is paying 8% annual interest, compounded semiannually. Answer: Lena Dimock is saving for her college expenses. She sets aside $200 at the beginning

2-1 If you deposit $10,000 in a bank account that pays 10% interest annually, how much will be in your account after 5 years? 2-2 What is the present value of a security that will pay $5,000 in 20 years if securities of equal risk pay 7% annually? 2-6 What is the future value of

How would a manager calculate present value and future value for single amounts, annuities, and uneven streams of cash flow.

Can you help me get started with this assignment? You are earning a salary of 30,000. You plan on retiring in 25 years. At the beginning of retirement you would like to have accumulated enough money in your 401k plan to receive an annuity for 20 years equal to 80% of your last years’ salary.

Assuming you can earn 11% a year on your 401k money over the next 25 years, how much will you need to save every year to reach your retirement goal in 25 years? Interest Rate (Rate): 11% Number of years: 25 Annual withdrawals amount (PMT) -50,250.67

TOP