Question
Peter invests $100,000 in a 3-year certificate of deposit earning 3.5% at his local bank. Which time value concept would be used to determine the
Peter invests $100,000 in a 3-year certificate of deposit earning 3.5% at his local bank. Which time value concept would be used to determine the maturity value of the certificate? (Points : 2)
Future value of an ordinary annuity. Future value of one. Present value of an annuity due. Present value of one.
Question 11.11. Barkley Company will receive $400,000 in a future year. If the future receipt is discounted at an interest rate of 8%, its present value is $252,068. In how many years is the $400,000 received? (Points : 2)
5 years 6 years 7 years 8 years
Question 12.12. If the number of periods is known, the interest rate is determined by (Points : 2)
dividing the future value by the present value and looking for the quotient in the future value of 1 table. dividing the future value by the present value and looking for the quotient in the present value of 1 table. dividing the present value by the future value and looking for the quotient in the future value of 1 table. multiplying the present value by the future value and looking for the product in the present value of 1 table.
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