questions 1-17

Name HOMEWORK ASSIGNMENT: CHAPTER 12 Class Unit 12.1 Time-value-of-money terminology ANSWERS For Problems 1-5, assume you deposit $1,500 today in a savings account. You earn 7.5%, compounded semi-annually. You deposit an additional $250 1. at the end of each 6 months. At the end of 5 years, you withdraw the balance 2. of $5, 134.53. Identify each value. 1 . n? 2. i? 3. PV? 4. PMT? 5. FV? 3 . For Problems 6-8, assume you purchased some corporate stock 4 years ago for $7,500. You received quarterly dividends of $75; your dividends total $1,200 (16 dividend checks x $75 = $1,200). You sold the stock today for $8,050. 6. The PV is $8,050 because that is the amount you received today (in the a present). (T or F) N 7. $1,200 represents which variable (PV, PMT, or FV)? 8. What is the FV amount? Unit 12.2 Financial calculators 9. When is it not necessary to clear the TVM registers? 10. By setting our "periods per year" register at I we must enter the periodic rate in the i-register. (T or F) 11. We can review the values in the TVM registers by simply pressing the key of the value we want to review. (T or F) 12. Values can be entered in the TVM registers in any order. (T or F) 13. When entering dollar amounts in the PV, PMT, and FV registers, we should enter amounts paid as positive numbers, and amounts received 10. as negative numbers. (T or F) 14. Suppose you are entering a negative $300 in the PMT register. 11. Keystrokes are: [ - ] 300 [PMT]. (T or F) 12. 15. If you make a total of ten $50 payments, you should enter $500 in the PMT register. (T or F) 13. Unit 12.3 Future value 14. 16. 150 years ago, your great-great-great-grandmother stuffed $55 under her mattress because she didn't trust the bank. If she would have had more 15. faith in the bank and had deposited that money in a savings account earning 3% compounded quarterly, how much money would be in that 16. account today? 17. 17. Gregg Levan is 45 years old and deposits $1,000 at the end of every 6 months into an individual retirement account (IRA). If the account earns 6.45% compounded semi-annually, how much will Gregg have when he retires 22 years later? Chapter 12 45