Select payments are known as lump sums. We can solve for the future or the present value of a lump sum as we discuss below Finding the future value (FV). Se Is the process of going from today's values to future amounts. The equations PV, PV(1+)" Here, PV - present value - Interest rate per year and number of periods. You can use calculators and spreadsheets to find ture values. A grach of the Select process shows how any sum grows over time at various interest rates. The greater the interest rate, the Select the growth rate Finding the present Value (PV) is called discounting, and it is simply the reverse of Sales In general, the present value of a cash flow due Nyears in the future is the amount which, it were on hand today, would prove to equal the given future amount. The PV equation is Present Value - PV. A graph of the discounting process shows how the present value of any som to be received in the future decreases and proaches Select as the years to receipt increases, and the present value dedines faster att interest rates. The fundamental goal of financial management is to maximize the fom's value and the value of any asset is the select value of its expected future cash flows. One can solve for either the interest rate or the number of periods using the PV and the equations. The castest way to solve for these variables is with a financial calculator or a spreadsheet Quantitative Problem ti You deposit $1,700 inte an account that pars per year your plan is to draw this amount at the end of years to use for a down payment on a new car How much will you be able to withdraw at the end of 5 years? Do not round Intermediate calculations. Round your answer to the nearest cent. $ Quantitative Problem 2. Today, you invest a lump sum amount in an equity fund that provides an 12 annual retum. You would like to have $12,000 in 6 years to be with a down payment for a home. How much do you need to deposit today to reach your $12,000 goal? Do not round intermediate calculations. Round your wer to the nearest cont $ Select Payments are known as lumess we can solve for the future value of an awes below Finding the future value (TV), or Select the process from todos estore amounts The Vio PV, PV) Here, PV - present value I - Interest rate per year, and number of period you can calculators and spreadsheets to find future values. A grach of these Interest rates. The greater the interest rate, the Select the growth rate Finding the present value (PV) is called discounting, and it is simply the reverse offert In general, the present value of a cash flow de Nyears in the future is the amount which, it were on hand today would grow to equal the given future amount. The PV equation is Premat value-PY A graph of the discounting process shows how the present value of any sum to be received in the future decreases and abroaches alles was the years to receipt increases, and the present value dedines faster Select interest rates. The fundamental goal of financial management is to maximize the firm's value, and the value of any set is the select value of its expected future cash flows. One can solve for either the interest rate or the number of periods using the TV and the equations. The easiest way to solve for these variabile is with a financial calculator or a spreadsheet Quantitative Problem ti You deposit $1,700 into an account that pays per year. Your plan is to withdraw this amount at the end of years to use for a down payment on a new car. How much will you be able to withdraw at the end of 5 years? Do not round intermediate calculations. Round your answer to the nearest cent $ Quantitative Problem 2: Today, you invest alump sum amount in an equity fund that provides a 12 annual return, you would like to have $12,000 in o years to help with a down payment for a home. How much deposit today to reach your $12,000 goal? Do not round intermediate calculations. Round your answer to the nearest cent. you need to
