Introduction to Finance FIN2030
Week 2, Assignment 2
Part One: Quantitative Exercises
		Used financial calculator
Questions	Answers
1. Future Value. What is the future value of
a. $800 invested for 14 years at 11 percent compounded annually?	$3,448.35	pv=-800, n=14, I=11
b. $210 invested for 8 years at 9 percent compounded annually?		pv=-210, n=8, I=9
c. $650 invested for 12 years at 8 percent compounded annually?		pv=-650, n=12, I=8
2. Present Value. What is the present value of
a. $803 to be received 18 years from now at a 10 percent discount rate?	$144.42	fv=803, n=18, I=10
b. $406 to be received 7 years from now at a 5 percent discount rate?
c. $400 to be received 10 years from now at a 9 percent discount rate?		fv=400, n=10, I=9
3. Future Value of an Annuity. What is the future value of
a. $557 a year for 12 years at 5 percent compounded annually?	$8,865.84	pmt=-557, pv=0, n=12, I=5
b. $748 a year for 9 years at 12 percent compounded annually?		pmt=-784, pv=0, n=9, I=12
c. $442 a year for 7 years at 11 percent compounded annually?		pmt=-442, pv=0, n=7, I=11
4. Present Value of an Annuity. What is the present value of
a. $1,163 a year for 12 years at an 7 percent discount rate?	$9,237.34	pmt=1163, n=12, I=7
b. $329 a year for 6years at a 12 percent discount rate?
c. $365 a year for 20 years at a 14 percent discount rate?		pmt=365, n=20, I=14
5. How many years will it take to grow
a. $765 to a value of 2,028.19 at a compound rate of 14 percent?	7.44
b. $321 to a value of 450.22 at a compound rate of 12 percent?
c. $881 to a value of 1,305.78 at a compound rate of 7 percent?	5.82	pv-881, fv=1305.78, I=7
6. Interest Rate. At what interest rate will it take to grow
a. $800to a value of 1,017.13 over 6 years?	4.08%	pv=-800, fv=1017.13, n=6
b. $600 to a value of 1,082.08 over 5 years?	12.52%	pv=-600, fv=1082.08, n=5
c. $401 to a value of 1,311.16 over 6 years?
7. Car Loans (Hint: P/Y=12). How much is a car loan with a payment of
a. $453 per month for 3 years at 6% interest per year?		pmt=-453, n=36, I=6
b. $466 per month for 5 years at 15% interest per year?	$19,588	pmt=-466, n=60, I=15
c. $301 per month for 6 years at 7% interest per year?
8. Mortgages (Hint: P/Y=12).
What was the initial mortgage on the house?
a. $4,369.66 per month for 30 years at 8 percent interest?	$595,513	pmt=-4369.66, n=360, I=8
b. $1,626.83 per month for 15 years at 4 percent interest?		pmt=-1626.83, n=180, I=4
c. $3,724.21 per month for 30 years at 18 percent interest?		pmt=-3724.21, n=360, I=18
9. Mortgages (Hint: P/Y=12). What is the payoff on a 30 year, 6% mortgage of
a. $255,413 with a payment of 1,321.33 with 8 years remaining?
b. $530,493 with a payment of 3,180.57 with 12 years remaining?	$325,910.30
c. $297,266 with a payment of 1,782.26 with 11 years remaining?