Question: Q. 1. What is meant by the term Time Value of Money and why is it important ? Q.2. a. What is Present Value ?
Q. 1. What is meant by the term "Time Value of Money" and why is it important ?
Q.2. a. What is Present Value ? Write the formula.
b. What is Future Value ? Write the formula.
Q.3. What are the main elements for calculating time of money ? List the elements.
a. b. c. d. e.
Q. 4. Calculate the present value of the following based on simple interest
fv (future value) | n (number of period) - Year | r(rate of interest) | pv (present value | ||
$1,000 | 2 | .04 | ? | ||
$1,000 | 5 | .07 | ? |
Q. 5. Calculate the future value of the following based on simple interest
pv (present value) | n (number of period) - Year | R (rate of interest) | fv (future value | ||
$1,000 | 7 | 0.09 | ? | ||
$1,000 | 8 | 1.0 | ? |
Q.6.Calculate the future value of the following based on compound interest
pv (present value) | n (number of period) - Year | R (rate of interest) | fv (future value | ||
$1,000 | 4 | 0.06 | ? | ||
$1,000 | 5 | 0.07 | ? |
- Q.7.Calculate the present value of the following based on compound interest
fv (future value) | n (number of period) - Year | r(rate of interest) | pv (present value | ||
$1,000 | 4 | .06 | ? | ||
$1,000 | 5 | .07 | ? | ||
$1,000 | 6 | .08 | ? | ||
$1,000 | 7 | .09 | ? |
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