The principal of the time value of money is probsbly the single most important concept in financial management. One of the inost frecuenty encountered applications ifvetves the calculatien of a future value. The process for converting gresent values into future values is called This process requres knowlecge of the values of three of four time-value-of-money variables. Which of the following is not one of these variables? The infiaticn rate indiceting the change in average prices The interest rate (1) that could be earned by ifvested funds The present value (FV) of the amount irvested The duration of the investment (N) All other things being equal, the numerical itference between a presene and a future yalue correiponds to the ampunt of interest earned during the depost or investment period. fach line on the following grath corresponds to an ingerest rate: 946,9% or 10%. Identfry the interest rate that correspends with each line Investments and loans base their interest calculations on one of two possible methods: the interest and the interest methods. Both methods apply three variables-the amount of principal, the interest rate, and the investment or deposit period - to the amount deposited or invested in order to compute the amount of interest. However, the two methods differ in their relationship between the variables. Assume that the variables I, N, and PV represent the interest rate, investment or deposit period, and present value of the amount depouted or invested, respectively/ Which equation best represents the calculation of a future value (FV) using? Compound interest? PV=PV(1+1)NPV=PV+(PV1N)PV=PV/(1+1)N Simple interest? FV=PV/(PVIN)FV=PVINFV=PV+(PV1N) Identify whether the following statements about the simple and compound interest methods are true or false. Heather is willing to invest $30,000 for six years, and is an econornicaly rational investor she has identhed three investurent alternatives (L, M, and P) that vary in their method of caiculating interest and in the annual interest rate offered. Since she can only make one investment during the slx-year investment period, complete the following table and indicate whether Heather should invest in each of the investments: Note: When caiculating each investment's future value, assume that all interest is earned annually. The final value should be rounded to the nearest whole dollar