Repeat problem 9.1, but assume the following compounding conditions:

a. Semiannual

b. Quarterly

Problem 9.1

Find the following values for a lump sum assuming annual compounding:

• The future value of $500 invested at 8 percent for one year

• The future value of $500 invested at 8 percent for five years

• The present value of $500 to be received in one year when the opportunity cost rate is 8 percent

• The present value of $500 to be received in five years when the opportunity cost rate is 8 percent