Question
Question 1: Calculate the present value of $5000 received five years from today if your investments pay: 6 percent compounded annually 8 percent compounded annually
Question 1: Calculate the present value of $5000 received five years from today if your investments pay:
6 percent compounded annually
8 percent compounded annually
10 percent compounded annually
10 percent compounded semiannually
10 percent compounded quarterly
What do your answers to these questions tell you about the relation between present values and interest rates and between present values and the number of compounding periods per year?
Question 2: Calculate the future value in five years of $5,000 received today if your investments pay:
6 percent compounded annually
8 percent compounded annually
10 percent compounded annually
10 percent compounded semiannually
10 percent compounded quarterly
What do your answers to these questions tell you about the relation between future values and interest rates and between future values and the number of compounding periods per year?
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