Question 1

1pts

1. True or False? A dollar today and a dollar a year later do not have the same value. Because of Time Value of Money, a dollar today can buy more than a dollar a year later.

Group of answer choices

True

False

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Question 2

1pts

2. You received a $1000 savings account earning 9% compounded annually on your first birthday. How much money will you have on your 25th birthday if you don't withdraw any money before then?

Group of answer choices

A) $4,750

D) $1,900

B) $7,911.08

E) $25,000

C) $86,230.81

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Question 3

1pts

3. You are offered a $100 000 payment in 8 years. If the interest rate is 10% compounded annually, what is the payment worth today?

Group of answer choices

E) None of the above

D) $146,650.74

C) $466,507.38

A) $46,650.74

B) $100,000

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Question 4

1pts

4. An investor wants to have $50,000 in four years. If he deposits 29,604 in the bank today, with annual compounding, what interest rate must the bank pay to achieve this goal?

Group of answer choices

D) 17%

B) 2%

A) 14%

F) 50%

C) 20%

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Question 5

1pts

5. You want to purchase a house. You estimate that you will need a $20,000 down payment. If you have $14,000 today and your bank is offering 8% interest compounded annually, how long will it take you to raise the funds?

Group of answer choices

D) 6 months

B) 2 years

A) 6 years

C) 4 years and 8 months or 4.63 years

E) 6 years and 8 months