Question: Consider a given lump sum FV, for which we have calculated a present value (PV) using some interest rate (l) and number of time periods

Consider a given lump sum FV, for which we have calculated

Consider a given lump sum FV, for which we have calculated a present value (PV) using some interest rate (l) and number of time periods (N). If we do not change the FV amount, nor the interest rate I, but increase the number of time periods (N) in our calculation of a present value, how will the present value (PV) change (relative to the value we originally calculated with a smaller N)? The new PV will increase change, but without knowing the specific values we cannot determine if it will increase or decrease be equal to zero decrease remain unchanged

Step by Step Solution

There are 3 Steps involved in it

1 Expert Approved Answer

Step: 1 Unlock blur-text-image

Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock

Step: 3 Unlock

Students Have Also Explored These Related Finance Questions!

Question 1 (3.5 points) Consider a given lump sum FV, for which we have calculated a present value (PV) using some interest rate (I) and number of time periods (N). If we do not change the FV amount,...

Please refer to my attached question papers. I got total 5 pages below. Thanks in advance . SECTION A : ANSWER ALL QUESTIONS (TOTAL 40 MARKS] ZKA Co. is evaluating an investment proposal to...

Mini-Case B (7 marks) Like every Canadian couple, Amira and Owen carry quite a lot of debt. Three years ago, Amira purchased a Subaru Outback costing $34,750 before sales tax of 15%, with a $5,000...

i do not understand this can someone please help me with this? Time Value of Money, Opportunity Cost, and Income Taxes Worksheet FP/100 Version 1 1 Time Value of Money, Opportunity Cost, and Income...

gives the breakdown of how much of each payment is interest and how much is a repayment of A(n) principal a. amortization schedule b. simple loan schedule c. perpetuity loan schedule d. demand loan...

please help me solve all the problems below with steps. thank you. Since we are calculating for the Expected Future Value, we will use FVe. We can think of the Expected Future Value as the Future...

dori Figure 5.4 Formula for Compound Interest If you have a calculator with a y' key, you can c can compute compound interest and the amount by using this formula: A = P(1.00 +r)" Where A = Amount,...

See page 129- 137 on attachment for more details there are five steps to the project. Step 1: Create the loan amortization schedule for the property. Step 2: Create the depreciation schedule. Step 3:...

Calculate the following time value of money problem using Microsoft Excel Please show your work in the cells. Use Excel formulas instead of writing the values/answers directly in the cell. 1) If we...

Two sheets of polarizing material are placed with their transmission axes at right angles to one another. A third polarizing sheet is placed between them with its transmission axis at 45 to the axes...

Kemano Motorcycles sold $800,000 of receivables to a factor to increase the companys liquidity. The company chose to factor these receivables without recourse. In exchange for these receivables, the...

A firm's ROE is above the industry average, but its debt ratio and profit margin are both below the industry average. Select the correct statement.

how do 1 st line managers primarily execute operational planning within an organization

=+What needs to be said first?

=+2. What can you ask the audience to do? (Enter a contest, write a comment, or create a video showing them using the product or service.)

=+You couldn't expect more from a cow, could you?