1.You will receive $50,000 at the end of 10 years. If the rate of interest is 8% per year, how much is the current value of your cash flow?

A.$25,0124.45

B.23,159.97

C.$27,013.44

D.$46,296.30

2.If you invest $24,500 today at the rate of 5% per year, how much money would you have at the end of 8 years?

A.$25,725.00

B.$27,011.25

C.$28,361.82

D.$36,197.66

3.How much would Danielle have to invest today at the rate of 12%, compounded semiannually to have $25,000 at the end of 4 years?

A.$15,887.95

B.$22,212.18

C.$15,579.17

D.$15,685.31

4.Trisha has $5,000 to invest today.She invests the money in bank account that promises an interest rate of 5.2%, compounded weekly. How much money will she have at the end of 5 years?

A.5,025.05

B.3,855.76

C.6,483.81

D.6,442.41

5.In calculation of time value of money, the interest rate has a _________ relationship to the present value and _________ relationship to the future value of an investment.

A.positive; negative

B.negative; negative

C.negative; positive

D.positive; positive

E.None of the options specified here

6.The present value of a single future sum:

A.is generally larger than the future sum.

B.depends upon the number of discount periods.

C.increases as the discount rate increases

D.increases as the time period increases

E.None of the options specified here

7.Ms.Stormy anticipates receiving $50,000 at the end of five years from her bank account.If the rate of interest is 8 percent, compounded annually, how much moneyStormy must have put aside in the bank account today?

A.$46,296.63

B.$54,000

C.$73,466.40

D.$34,029.19

E.None of the options specified here

8.Edward Hill needs $25,000 at the end of 5 years. He currently has $5,000 to invest.At what rate should he invest his money?

A.38%

B.5%

C.10%

D.20%

9.At 8 percent compounded annually, how long will it take $750 to become $1500?

A.6.5 years

B.48 months

C.9 years

D.12 years

E.None of the options specified here

10.Ryan needs $16,000 to buy a new car. If he has $2,000 to invest at 20%, compounded annually, how long will he have to wait to buy the car?

A.4.81 years

B.20 years

C.8.41 years

D.11.41 years

11.At what rate should you invest your money today so that your investment gets tripled in8years?

A.14.72%

B.24%

C.10%

D.12%

12.At what rate must $400 be compounded annually for it to grow to $716.40 in 10 years?

A.6%

B.5%

C.7%

D.8%

E.None of the options specified here

13.If Hamidou invests $7500 today at 8 percent compounded semi-annually, how much would he accumulate at the end of 10 years?

A.$16,191.94

B.$10,193

C.$22,334

D.$16,433.42

E.None of the options specified here

14.Which of the following provides the greatest annual interest and highest future value?

A.15% compounded annually

B.15% compounded semiannually

C.15% compounded monthly

D.15% compounded weekly

E.None of the above

15.IfVictoria wants to have $1700 in seven years, how much money must she put in a savings account today? Assume that the savings account pays 6% and it is compounded quarterly

A.$1120

B.$1130

C.$1140

D.$1150

E.None of the options specified here

16.Winner Lei is thinking of buying a miniature golf course. It is expected to generate cash flows of $40,000 per year in years 1,$50,000 per year in year 2 and year 3. If the appropriate discount rate is 10%, what is the present value of these cash flows?

A.$285,288

B.$167,943

C.$235,048

D.115,251

E.None of the options specified here

17.If you have $10,000 to invest today, which of the following will give you highest future value?

A. 10% per year, compounded annually

B. 10% per year, compounded semiannually

C. 10% per year, compounded quarterly

D. 10% per year, compounded daily

18.In calculation of time value of money, the frequency of compounding the interest rate has a _________ relationship to the present value and _________ relationship to the future value of an investment.

A.positive; positive

B.negative; positive

C.negative; negative

D.positive;negative

19.Suppose you win a lottery and under the terms of the lottery, you will receive $250,000 per year for the next 25 years. If the rate of interest is 12% per year, how much is the present value of your winnings?

A.1,960,785

B.4,250,016

C.5,000,000

D.$518,334

20.What is the present value of $27 received at the end of each year for 5 years?Assume a discount rate of 9%. The first payment will be received one year from today

A.$42

B.$114

C.$88

D.$105

E.None of the options specified here

21.Tamikawins a lottery and under the terms, she will receive $100,000 per year forever. If the rate of interest is 20% per year, how much is the present value of her winnings?

A.$100,000

B.$1,000,000

C.$2,000,000

D.$500,000

E.None of the options specified here