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Period Cash Flows Quiz

How much money will William have in five years if he places $2500 into a CD earning an annual interest rate of 7.5% compounded annually?

How would the markets need to manipulate the rate of return on your investment to decrease the future value of your investment?

Janet and Dean want to make a down payment of $75,000 on a condominium when they retire in seven years. If they can earn 9% on their investments, how much money do they need to invest today to have enough for the down payment?

An ordinary annuuity has equal periodic cash flows at the________of the period and an annuity due has equal periodic cash flows at the _________ of the period.

If you have a required rate of return of 5%, which of the following choices has greater value?

Your firm is planning to invest $350,000 per year in equal annual end-of-the-year cash flows to fund a capital improvement fund. If the investments are expected to earn 10% per year, how much will the account be worth in 7 years?

Your parents put equal annual beginning-of-the-year deposits of $1,200 into an account earning 8% per year from the day you were born until your 18th birthday (a total of 19 deposits). How much money is in that account today?

A perpetuity is

Tucker Binson put $5,000 into a three-year CD paying 7% interest compounded quarterly. How much interest will he have earned when the CD matures?

How large are the monthly payments of a recent college graduate with $35,000 in student loans, if the payments are to be made for 10 years and the annual interest rate on the loans is 6.0%?