# The present value of $200 t b received 10 years from today, assuming an opportunity cost of 10 % , is

1. The present value of $200 t b received 10 years from today, assuming an opportunity cost of 10 % , is

a. $200

b. $450

c. $518

d. $77

2. The future value of a dollar__________as the interest rate increase and ___________the farther in the future an initial deposit is to be received.

a. Increases, increases

b. Decreases; increases

c. Decreases; decreases

d. Increases; decreases

3. The present value of a $25,0000 perpetuity at a 14% discount rate is

a. $350,000

b. $285,000

c. $178,571

d. $219,298

4. The future value of $100 received today and deposited in an account for four years paying semiannual interest of 6% is

a. $450

b. $889

c. $134

d. $126

5. The future value of an annuity of $1,000 each quarter for 10 years, deposited at 12 % compounded quarterly is

a. $75, 401

b. $17,549

c. $93, 049

d. $11, 200

6. Adam borrows $4,500 at 12% annually compounded interest to be repaid in four equal annual installments. The actual end of year payment is

a. $2,641

b. $1,125

c. $942

d. $1,482

7. Ashley owns stock in a company which has consistently paid a growing dividend over the last five years. The first year Ashley owned the stock, she received $1.71 per share, and in the fifth year, she received $2.89 per share. What is the growth rate of the dividend over the last five years?

a. 75

b. 5%

c. 14%

d. 12%

8. Julian was given a gold coin originally purchased for $1 by his great grandfather 50 years ago. Today the coin is worth 450. The rate of return realized on the sale of this coin is approximately equal to

a. 13%

b. 50%

c. 7.5%

d. Cannot be determine with give information

9. Ant Bertha borrows $19,500 from the bank at 8% annually compounded interest to be repaid in 10 equal annual installments. The interest paid in the 3rd year is.

a. $1,947.10

b. $1,336.00

c. $2,906.11

d. $1,560.14

10. What annual rate of return would Granma Zoe need to earn if she deposits $1,000 per month into an account beginning one month from today in order to have a total of $1,000,000 in 30 years?

a. 5.98%

b. 5.28%

c. 6.23%

d. 4.55%

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