1. 2. 3. 4. 5. 6. 7. 8. 9. FINC 2110 FINANCIAL MANAGEMENT TUTORIAL 1: TIME VALUE OF MONEY JUNE 2023 SEMESTER How long would it take an investment to grow five-fold if it were invested at 8 percent compounded quarterly? Amrit Kolar bought a new house by borrowing RM300,000 on a mortgage at 6 percent per annum repayable over 30 years in equal annual payments. How large will his annual payments be? You have an opportunity to make an investment that will pay RM100 at the end of the first year, RM400 at the end of the second year, at the end of third year and at the end of fourth year and RM300 at the end of the fifth year. Find the present value and the future value if the interest rate is 8 percent. Although appealing to more refined tastes, art as a collectible has not always performed so profitably. During 2003, Sotheby's sold the Edgar Degas bronze sculpture Petite Danseuse de Quartorze Ans at auction for a price of $10,311,500. Unfortunately for the previous owner, he had purchased it in 1999 at a price of $12,377,500. What was his annual rate of return on this sculpture? You have just made your first $2,000 contribution to your individual retirement account. Assuming you earn a 12 percent rate of return and make no additional contributions, what will your account be worth when you retire in 45 years? What if you wait 10 years before contributing? (Does this suggest an investment strategy?) You are scheduled to receive $25,000 in two years. When you receive it, you will invest it for six more years at 7.9 percent per year. How much will you have in eight years? You expect to receive $10,000 at graduation in two years. You plan on investing it at 11 percent until you have $100,000. How long will you wait from now? Liza borrow RM500,000 from a bank to buy a house for 5 years financing. Develop an amortization table for 5 years if the interest rate is 5 percent per annum. Currently Ahmad has deposited RM4,000 every month in accounts at 12 percent interest rate compounding monthly. He wants his amount in his account to be as RM50,000 after n years. How long he has to deposit to has with that amount? 10. How much is the interest rate growth if RM10,000 today would be accumulated to RM70,000 after 30 years? 11. Wendy has RM5,000 invested in a bank that pays 3.8% annually. How long will it take for her funds to triple? 12. Daddy has invested RM1,000 at the end of every six months at interest rate of 12% compounding semi-annually for 12 years. How much the amount accumulated after 12 years? If Daddy invested in the beginning of every six months? 13. Mama plan to pay RM50 at the end of every week to her charity fund at interest rate of 10% compounding weekly for 5 years. What is the amount Mama has now? If Mama pay in the beginning of every week?