1) What is the future value of $2,500 in 5 years with an interest rate of 3.5% ? Answer: 2) What is the future value of $2,500 in 15 years with an interest rate of 3.5% ? Answer: 3) What is the future value of $2,500 in 15 years with an interest rate of 4.5% ? Answer: 4) What is the present value of $25,000 to be received in 5 years with an interest rate of 2.5% ? Answer: 5) What is the present value of $25,000 to be received in 25 years with an interest rate of 2.5% ? Answer: 6) What is the presept value of $25,000 to be received in 25 years with an interest rate of 3.5% ? Answer: 7) What is the combined present value of $5,000 to be received in 5 years and another $5,000 to be received in 10 years with an interest rate of 5.0% per year for the first 5 years, then the rate increases to 7.5% per year? Answer: 8) What is the present value of $5,000 to be recelved every year for the next 10 years with an interest rate of 2.5% ? Answer: 9) What is the present value of an annuity due that pays $5,000 every year for the next 10 years with an interest rate of 2.5% ? Answer 10) What is the present value of $1,000 to be received every year for the next 25 years with an interest rate of 5.0% ? Answer: 11) What is the future value of $5,000 to be received every year for the next 10 years with an interest rate of 2.5% ? Answer: 12) What is the future value of an annuity due that pays $5,000 every year for the next 10 years with an interest rate of 2.5% ? Answer: 13) What is the annual percentage yield (APY)? a. 1-Year CD quoted as 8.13% compounded daily (assume 365 days) b. 1-Year CD quoted as 8.14% compounded bi-weekly (Twice a week) c. 1-Year CD quoted as 8.15% compounded weekly d. 1-Year CD quoted as 8.22% compounded quarterly e. Which of the following is most appealing? 14) You purchased a house for $100,000, but you take out a loan for $80,000. The loan requires equal payments every month for 30 years. The interest rate you are charged is 6%. What is your monthly payment? Answer: 15) Using the information from question 14 what would be your monthly payment if your payment was due at the beginning of the month (i.e. an annuity due)? Answel 16) Your parents have decided they want to put money aside today for you. Their plan is to start allowing you to withdraw $25,000 a year for 15 years starting on your 65th birthday. Today is your birthday and you are now 21 . If your parents account guarantees 4%, how much money do they need to put in the account today? Answer: 17) What is the value of a perpetuity that pays $0.01 every day for life, if the current interest rate is 3.65% compounded daily? (Assume 365 days in a year) Answer: 18) What is the value of a perpetuity that pays you $4 a year for life, if the current interest rate is 3.89%
