Contrast the calculation of future (terminal) value with the calculation of present value. What is the difference?
Posts Tagged ‘Finance’
i need help on a Finance question regarding Future Value?
06
Jun
i earned 53 cents during a 30-day month in a savings account that pays 5.16% and my average daily balance was $127.89……i am playing around with the future value formula FV= PV[1+(r/m)]^(m*n) and i cannot figure out how they got 53 cents of interest from a $127.89 average daily balance? Interest is compounded daily and computed from the average daily balance on the last day of the month.
Will anyone EVER accept Public Campaign Finance in future elections?
04
Jun
Supporters of public financing generally believe that the public financing system decreases corruption; in addition, many proponents believe that public financing promotes other values, such as civic participation or greater faith in the political process.
Finance Problem: Future value of an annuity?
02
Jun
Your client is 40 years old, and she wants to begin saving for retirement, with the first payment to come one year from now. She can save 5,000 per year, and you advise her to invest it in the stock market, average return of 9%.
I figured out that at 65 she would have saved: $423,504.48. At 70 she would save: 681,537.69.
The question then asks if she expects to live for 20 years in retirement if she retires at 65 and 15 years if she retires at 70, at the same interest rate….how much could she withdraw at the end of each year after retirement at each retirement age?
I just need some help in the right direction for the final part of this problem. Thanks in advance.
FINANCE HOMEWORK HELP! TVM?
31
May
1. What is the future value of $1,800 invested today
at 18% interest in 30 years with interest
compounded quarterly?
a. $258,067.15
b. $354,182.71
c. $300,154.84
d. $394,832.66
e. $9.15
2. What is the present value of $9,200
received 7 years from now using a
8% interest or discount rate, with
interest compounded monthly?
a. $5,257.39
b. $5,284.25
c. $4,874.91
d. $16,076.28
e. $5,264.90
3.What is the future value of $10.00 (ten dollars)
deposited at the end of each week for 4 years
earning 6% interest?
a. $2,208.34
b. $1,848.28
c. $40.07
d. $2,352.01
e. $2,349.30
4.What is the present value of $1,150 deposited
at the end of each quarter year for 12 years
earning 6.5% interest?
a. $12,446.51
b. $82,646.99
c. $38,743.67
d. $35,646.09
e. $38,124.16
5.What is the monthly car payment on a
4 year $21,000 car loan at 6% annual
interest?
a. $6,049.20
b. $5,717.38
c. $6,060.42
d. $493.19
e. $490.73
6.If you have $250,000 saved for retirement, how
many months will it last if you earn an annual
interest rate of 5% and withdraw $1,300 at the end
of each month?
a. 33
b. 30
c. 389
d. You will never run out of money
e. 385
7Assume the following information for
a car note:
Original loan amount = $24,000
Annual interest rate = 5.60%
Term of loan = 72 months
What is the principal balance
on the loan after four years?
a. $20,537.22
b. $8,908.66
c. $16,875.46
d. $7,492.14
e. $10,642.60
8. What is the Net Present Value (NPV)
of spending $15,000 today on graduate
school which will allow you to earn
$1,500 more a year for the next 35 years
assuming you could invest this money
elsewhere and earn 11%?
a. ($13,282.86)
b. $1,717.14
c. $29,737.30
d. $13,282.86
e. ($1,717.14)
9. If you have a $25,000 car note with a
$760.00 monthly payment, payable
over 36 months, what interest rate are
you paying?
a. 4.5%
b. 5.0%
c. 6.5%
d. 6.0%
e. 7.0%
10. You plan to buy some undeveloped
land that should sell for $235,000
in five years. What is the most you
can pay to ensure a 15% annual return?
a. $119,926
b. $121,483
c. $116,837
d. $125,286
e. $132,578
Best jobs with Finance BBA without MBA to prepare for future investment banking?
28
May
I’ll only have a BBA in Finance and I’ve heard it’s hard to get a job in investment banking without MBA so what’s a job I should get in the meantime that will be useful to the future career in investment banking or private equity?
Business Finance Question.?
27
May
Mrs Shafi has to choose the better of two equally costly cash flow streams, annuity A and
annuity B. Annuity A is an annuity due with a cash inflow of Rs. 9,000 for each of 6 years. Annuity B is an ordinary annuity with a cash inflow of Rs. 10,000 for each of 6 years. Assume that Mrs Shafi can earn 15 percent on her investments.
Help Mrs Shafi to decide which annuity is more better for her and why?
Note: (Calculations are not required.Do your calculations in rough work and support your answer in just one line.)
Future value finance homework help?
27
May
I tried applying the future value formula to this problem:
Find the future value of $4300 at 6.75% compounded quarterly for 5.5 years.
The answer I came up with is 6158.74, but it says I have the wrong answer. What am I doing wrong?
True/False Questions (Finance)?
26
May
1.The valuation of a financial asset is based on the concept of determining the present value of future cash flows.
2.Money markets are for short-term fund raising, whereas capital markets are for long-term fund raising.
3.In estimating the market value of a bond, the coupon rate should be used as the discount rate.
4.When the discount rate is greater than coupon. Rate, the intrinsic value of the bond is always greater than the par value of the bond.
5.To use Gordon Constant model, a firm must have a constant growth rate and the discount rate must be less than the growth rate
6.A stock that has a high required rate of return because of its risky nature will usually have a high P/E ratio.
represents a required rate of return by investors as well as a cost to the firm.
8.Weights used to calculate the weighted average cost of capital W ACC are derived from the capital structure.
Help with finance please!?
22
May
1.Capstone Checkpoint: Present Value, Future Value, and Annuity Due – Due Day 5
·Complete the following problems (Do Not repeat the questions):
Prob. 1: What is the present value of:
a.$4,000 in 7 years at 8 percent?
b.$25,000 in 5 years at 10 percent?
c.$10,000 in 25 years at 6 percent?
d.$1,000 in 20 years at 18 percent?
Prob. 2: If you invest 5,000 today, how much will you have:
a.In 5 years at 9 percent?
b.In 8 years at 12 percent?
c.In 30 years at 14 percent?
d.In 25 years at 20 percent (compounded semiannually)?
what is the best finance or marketing?which feild have great future . pls suggest me..?
22
May
what is the best finance or marketing?which field have great future (finance or marketing) with salary. pls suggest me..
solve the quiz.Business Finance MGT501?
19
May
1. A firm has paid out Rs. 150,000 as dividends from its net income of Rs. 250,000. What is the retention ratio for the firm?
a. 12 %
b. 25 %
c. 40 %
d. 60 %
2. ROE = ____________________
a. ROA x Equity Multiplier
b. ROA x ( 1 + Debt Equity Ratio)
c. Profit Margin x Total Assets Turnover x Equity Multiplier
d. All of the given options
3. Which of the following is NOT an external use of financial statements information?
a. Evaluation of credit standing of new customer
b. Evaluation of financial worth of supplier
c. Evaluation of potential strength of the competitor
d. Evaluation of performance through profit margin and return on equity
4.If you plan to save Rs. 10,000 with a bank at an interest rate of 8%, what will be the worth of your amount after 4 years if bank offers simple interest?
a. Rs. 3,200
b. Rs. 10,084
c. Rs. 13,200
d. Rs. 15,240
5.Which of the following process can be defined as the process of generating earnings from previous earnings?
a. Discounting
b. Compounding
c. Factorization
d. None of the given options
6. Both future value and present value of a sum of money are based on:
a. Interest rate only
b. Number of time periods only
c. Both interest rate and number of time periods
d. Neither interest rate nor number of time periods
7. Which of the following is CORRECT regarding the present value discount factor?
a. It is greater than 1.0
b. It is equal to zero when discount rate is zero
c. It increases as the time period increases
d. It decreases as the discount rate increases
8. In how many years, an amount will be doubled at a discount rate of 8 percent?
a. 3 years
b. 6 years
c. 9 years
d. Cannot be determined without more information
9.What is the present value of the following end‐of‐year cash flows if the discount rate is 7 percent? Years 1 2 3 Cash Flow (Rs.) 600 950 1,200
a. Rs. 1,998
b. Rs. 2,004
c. Rs. 2,171
d. Rs. 2,371
10. In which of the following type of annuity, cash flows occur at the beginning of each period?
a. Ordinary annuity
b. Annuity due
c. Perpetuity
d. None of the given options
Finance formulas?
17
May
What are the formulas for a lump sum, annuity perpituity in the present and future value
also simple and compound
Can I Finance A Car ?
16
May
Hi everyone.. so i just turned 18 a week ago.. and im looking to buy a financed car. i have a full time job over 38 hours and been employed for about 2 years.. im looking to make a 4000 down payment on a car that is for sell for around 8 to 12k.. i do have credit cards because some how when i was 17 i got approved for 3. i have about 1 year with them.i NEVER missed a payment on all of them. and i checked on a free credit report that i have over 700 in credit (not sure why). the problem is when they sent me the credit card they i said i was already 18 meaning i put a different year (1988 instead of 1990). will i be able to fix this in the future? will i still get a financed car? and will the credit score still show up (I THINK it will because its the same social security number).. well i hope you guys under stand what im trying to say with this.. hope you could help me.. thanks
Can I Be Able To Finance A Car?
16
May
Hi everyone.. so i just turned 18 a week ago.. and im looking to buy a financed car. i have a full time job over 38 hours and been employed for about 2 years.. im looking to make a 4000 down payment on a car that is for sell for around 8 to 12k.. i do have credit cards because some how when i was 17 i got approved for 3. i have about 1 year with them.i NEVER missed a payment on all of them. and i checked on a free credit report that i have over 700 in credit (not sure why). the problem is when they sent me the credit card they i said i was already 18 meaning i put a different year (1988 instead of 1990). will i be able to fix this in the future? will i still get a financed car? and will the credit score still show up (I THINK it will because its the same social security number).. well i hope you guys under stand what im trying to say with this.. hope you could help me.. thanks