An investor is considering an investment that pays a cash flow of $506 annually in perpetuity. The first cash flow is in the 3th year. If the interest rate is 12%, what is the present value of this investment? (round your final answer to the nearest dollar)

An investor interested in learning what must be earned on investments in order to allow their savings to grow to a certain amount of money in the future is interested should solve for which variable?

		the number of periods
		the interest rate
		the payment
		the present value
		the future value

What is the present value of an ordinary annuity that pays $302 per year for 23 years at 8%? Assume annual compounding. (round your answer to the nearest dollar)

Consider a loan for $100,000 to be repaid in equal installments at the end of each of the next 5 years. The interest rate is 4% compounded annually. What is the remaining balance of the loan after 2 years?

As the compound interest rate increases, the present value of future cash flows decreases.

True

False