Paper , Order, or Assignment Requirements

1. What is the value in year 4 of a $3,000 cash flow made in year 6 if interest rates are 9 percent?

2. What is the value in year 9 of a $1,400 cash flow made in year 4 if interest rates are 10 percent?

3. What is the value in year 6 of a $610 cash flow made in year 8 if interest rates are 9 percent?

4. Consider a $5,300 deposit earning 10 percent interest per year for 10 years.

What is the future value? (Do not round intermediate calculations and round your final answer to 2 decimal places.)

Future Value_______

How much total interest is earned on the original deposit? (Do not round intermediate calculations and round your final answer to 2 decimal places.)

Total interest earned______

How much is interest earned on interest? (Do not round intermediate calculations and round your final answer to 2 decimal places.)

Interest earned on the interest_______

5. What annual rate of return is earned on a $1,000 investment when it grows to $2,200 in seven years? (Do not round intermediate calculations and round your final answer to 2 decimal places.)

6. You wish to buy a $9,800 dining room set. The furniture store offers you a 3-year loan with an 11 percent APR. What are the monthly payments? (Do not round intermediate calculations and round your final answer to 2 decimal places.)

Payment $______per month

How would the payment differ if you paid interest only? (Do not round intermediate calculations and round your final answer to 2 decimal places.)

Payment $_______per month

7. What annual interest rate would you need to earn if you wanted a $600 per month contribution to grow to $55,000 in six years?

Annual interest rate______%

8. You wish to buy a $24,000 car. The dealer offers you a 4-year loan with a 10 percent APR. What are the monthly payments? (Do not round intermediate calculations and round your final answer to 2 decimal places.)

Payment $_______per month

How would the payment differ if you paid interest only? (Do not round intermediate calculations and round your final answer to 2 decimal places.)

Payment $_______per month

9. A small business owner visits his bank to ask for a loan. The owner states that he can repay a loan at $3,200 per month for the next three years and then $2,200 per month for two years after that. If the bank is charging customers 10.25 percent APR, how much would it be willing to lend the business owner? (Do not round intermediate calculations and round your final answer to 2 decimal places.)

10. If you start making $130 monthly contributions today and continue them for five years, what’s their future value if the compounding rate is 9.25 percent APR? (Do not round intermediate calculations and round your final answer to 2 decimal places.)

Future value annuity______ $

What is the present value of this annuity? (Do not round intermediate calculations and round your final answer to 2 decimal places.)

Present value annuity______ $