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Time Value of Money Quiz (Year, Compounded, Value)

A ________ shows the dollar amount and total number of periodic payments owed on a debt obligation.

More frequent compounding results in ________ future values and ________ present values.

The appropriate compounding or discount rate to use in a particular problem depends upon:

What is the future value of $5,000 in 10 years if the interest is compounding at 8% annually?

What is the present value of $5,000 received in 10 years if the interest is compounded at 8% annually?

In an annuity due, the cash flows occur at the end of each period.

What is the annual rate of return on an investment of $5000 that grows to $8,955 in 10 years?

Sinking fund problems determine the annuity amount necessary to recover some initial investment.

What is the future value of $500 per year for 10 years invested at 10%?

What is the monthly payment on a $184,000 mortgage loan, payable over 30 years with an APR of 6.8 percent?

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