Time Value of Money: Basics Using Excel or the equations and tables in...
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Time Value of Money: Basics Using Excel or the equations and tables in Appendix A of this chapter, determine the answers to each of the following independent situations. Round answers to the nearest whole number. a The future value in two years of $ deposited today in a savings account with interest compounded annually at percent. $Answer b The present value of $ to be received in four years, discounted at percent. $Answer c The present value of an annuity of $ per year for five years discounted at percent. $Answer d An initial investment of $ is to be returned in eight equal annual payments. Determine the amount of each payment if the interest rate is percent. $Answer e A proposed investment will provide cash flows of $ $ and $ at the end of Years and respectively. Using a discount rate of percent, determine the present value of these cash flows. Year Year Year f Find the present value of an investment that will pay $ at the end of Years and Use a discount rate of percent. $Answer
Time Value of Money: Basics
Using Excel or the equations and tables in Appendix A of this chapter, determine the answers to each of the following independent situations.
Round answers to the nearest whole number.
a The future value in two years of $ deposited today in a savings account with interest compounded annually at percent.
$Answer
b The present value of $ to be received in four years, discounted at percent.
$Answer
c The present value of an annuity of $ per year for five years discounted at percent.
$Answer
d An initial investment of $ is to be returned in eight equal annual payments. Determine the amount of each payment if the interest rate is percent.
$Answer
e A proposed investment will provide cash flows of $ $ and $ at the end of Years and respectively. Using a discount rate of percent, determine the present value of these cash flows.
Year
Year
Year
f Find the present value of an investment that will pay $ at the end of Years and Use a discount rate of percent.
$Answer
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