What is the present value of $1,000,000 payable in 20 annual installments of $50,000 each, assuming a discount (interest) rate of 12%.

You want to have $20,000 set aside in 4 years. How much money would you need to have set aside today in order to achieve your financial goal assuming you can earn 8% on your investment?

You want to have $40,000 set aside in an account to start a new business in 5 years. You can make 10 percent on your money. How much money would you have to put aside annually to have $40,000 in five years if you have $5,000 now to start with?

Answer rating: 100% (QA)

Solution 1 To calculate the present value of the 20 annual installments we can use the formula for t... View the full answer