Question 25 (updated)

25. Problem 5.10 (Fresent and Future Values for Different Interest Rates) Find the folbwing valves, Compounding/discounting occurs annyally, Do not round intermediate caiculations, found your ansaers to the aeareat cent. a. An initial 5700 compounded tor 10 years at 10%. 4 b. An initial $700 compounded for 10 years at 20%. 4 c. The present volue of $700 due in 10 vears at 10W 5 d. The present value of 12,545 due in 10 years at 20% and 1096 . Present value ot 20%:1 Present value at 10% : 5 e. Define aresent value 1. The present value is the value today of a sum of money to be received in the future and in general as lest than the future value. 1f. The gresent value is the value today of a sum of money to be recelved in the future and in general is greater than the future value. 11. The present value is the value teday of a sum of money to be received in the future and in general is equal to the future value. IV. The present value is the value in the future of a sum of money to be recelved tocay and in geseral is less than the fufure value V. The present volue is the value in the future of a sum of money to be received today and in general is greater than the future value. How are present valums affected by interest rates