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Archive for the ‘Value of Future Payments’ Category

Calculating Present Value?

17 Mar

The calculation for present value includes:

a. rate, number of periods, payment, future value, type

b. rate, payment, present value, future value, type

c. rate, number of periods, payment, present value, type

* I think the answer is “b” but I want to be sure. It seems to me that you would have to have the present and future value in order to calculate the present value. Am I correct in this thinking?
That makes sense! Of course present value cannot be part of the answer if that is what I am trying to calculate!

Thanks everyone!

I am still worried that one person said the answer was “C” though because they said they were 100% sure.

 
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what is the formula for future value of an ordinary annuity with interest compounded continuously?

17 Mar

A bank pays 10% interest compounded continuously.
what is the future value of a 5 year ordinary annuity with payments of 2000 each?

 
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An increase in the time to the promised future payment ________ the present value of the payment.?

16 Mar

An increase in the time to the promised future payment ________ the present value of the payment.

A) decreases
B) increases
C) has no effect on
D) is irrelevant to

 
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The future value of an annuity is A=$32,000. Periodic payments are made quarterly got four years?

15 Mar

and the annuity earns 8 % compounded quarterly. Find the periodic payments.

a. $422.40
b. $1,716.80
c. $2, 000 .00
d. $ 2, 160.00

 
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Which of the following changes would decrease the present value of a future payment?

14 Mar

a) a decrease in the size of the payment
b) an increase in the time until the payment is made
c) an increase in the interest rate
d) all of the above are correct

 
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True or False: A rise in interest rates decreases the present value of future payments.?

12 Mar

True
or
False

 
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What is the current value of the future payments?

12 Mar

Jean will receive $8,500 per year for the next 15 years from her trust. If a 7% interest rate is applied, what is the current value of the future payments? Describe how you solved this problem, include which table (for example, present value and future value) was used and why.

 
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