Time Value of Money Concept The following situations involve the application of the time value of money concept. Use the full factor when calculating your results. Use the appropriate present or future value table: FV of $1, PV of $1, FV of Annuity of $1 and PV of Annuity of $1 1. Janelle Carter deposited $9,580 in the bank on January 1, 2000, at an interest rate of 15% compounded annually. How much has accumulated in the account by January 1, 2017? Round to the nearest whole dollar. 2. Mike Smith deposited $21,370 in the bank on January 1, 2007. On January 2, 2017, this deposit has accumulated to $60,678. Interest is compounded annually on the account. What rate of interest did Mike earn on the deposit? Round to the nearest whole percent. % 3. Lee Spony made a deposit in the bank on January 1, 2010. The bank pays interest at the rate of 7% compounded annually. On January 1, 2017, the deposit has accumulated to $17,550. How much money did Lee originally deposit on January, 20107 Round to the nearest whole dollar. 4. Nancy Holmes deposited $4,000 in the bank on January 1 a few years ago. The bank pays an interest rate of 8% compounded annually, and the deposit is now worth $10,073. How many years has the deposit been invested? Round to the nearest whole year. years 7% 10% 15% ABLE 9-4 Present Value of Annuity of $1 (N) Periods 2% 3% 1 98039 97087 96154 95238 2 1.94156 191347 1 88609 1.85941 3 288388 2 82861 2.77509 2.72325 4 3.80773 3.71710 3.62990 3.54595 5 4.71346 4.57971 445182 432948 6 5.60143 5.41719 524214 5,07569 7 6.47199 6.23028 6.00205 5.78637 8 732548 701909 6.73274 6.46321 9 8.16224 7.78611 7.43533 7 10782 10 8.98259 8.53020 8.11090 7.72173 11 9.78685 9.25262 8.76048 8.30641 12 10.57534 9.95400 9.38507 8.86325 13 11.34837 10.63496 9.98565 939357 14 12.10625 1129607 10.56312 9.89864 15 12 84926 1193794 11.11839 10.37966 16 13.57771 1256110 11.65230 10 83777 17 1429187 13.16612 12.16587 1127407 18 14 99203 13.75351 12.65930 11.68959 19 15.67846 1432380 13.13394 12.08532 20 16.35143 14.87747 13.59033 12 46221 22 17.65805 15.93882 14 45112 13.16300 24 18.91393 16.93554 15 24696 13.79864 26 20.12104 17.87684 15.98277 14 37519 28 21.28127 18.76411 16.66306 14 89813 30 2239646 19,60014 17 29203 1537245 94340 1 83339 2.67301 346511 421236 4.91732 5.58238 6.20979 6.80169 7.38009 788687 8.38384 8.85258 9.29498 9.71225 10.10590 10.47726 10.82760 11.15812 11.46992 12.04158 12 55036 13.00317 13.40616 13.76483 93458 1.80802 262432 3.38721 4.10020 4.76654 5.38929 5.97130 6.51523 7.02358 7.49867 794269 8.35765 8.74547 9.10791 9.44665 9.76322 10 05909 10.33560 10.59401 11.06124 11.46933 11.82578 12.13711 12 40904 92593 1.78326 2.57710 331213 3.99271 462288 5.20637 5.74664 6.24689 6.71008 7.13898 7.53608 7.90378 8.24424 8.55948 885137 9.12164 937189 9.60380 9.81815 10.20074 10.52876 10.80998 11.05108 11.25778 90909 1.73554 2 49685 3.10987 3.79076 435526 488842 5.33193 5.75902 6.14457 6.49506 6.81369 7.10036 7.36869 7.80808 782371 8.02155 8 20141 836492 851356 8.77154 8.98474 9.16095 930657 9.42691 12% 89286 1.69005 240183 3.03735 3.60478 4.11141 456376 4.96754 532825 5,65022 5.93770 6.19437 8.42355 6.62817 6.81086 6.97399 7.11963 7 24967 736578 746944 7.64465 778432 7 89566 798442 8.05518 86957 1.62571 228323 2.85498 3.35216 3.78448 4.16042 448732 4.77158 5.01877 5.23371 5.42062 5.58315 5.72448 584737 5.95423 6.04716 6 12797 6.19823 625933 6.35866 6.43377 6.49056 6.53351 6.56598 TABLE 9-3 Future Value of Annuity of S1 (N) Periods 2% 5% 6% 7% 8% 10% 12% 15% 1 2 3 4 5 6 7 9 10 11 12 13 14 15 16 17 18 19 20 22 24 26 28 30 1.00000 2.02000 3.00040 4.12161 5.20404 6.30812 743428 8.58297 9.75463 10.94972 12.16872 13.41209 14.68033 15.97394 1729342 18.63929 20.01207 21.41231 22.84056 24 29737 27 29898 30 42186 33 67091 37 05121 40.56808 3% 1.00000 203000 3.09090 4.18363 5 30914 6.46841 7.66246 8.89234 10.15911 11.46388 12 80780 14.19203 15.61779 1708632 18.59891 20.15688 21.76159 23.41444 25.11687 26 87037 30 53678 34 42647 38.55304 42.93092 4757542 1.00000 2.04000 3.12160 4.24846 5.41632 6.63298 789829 9.21423 10.58280 12.00611 13.48635 15.02581 16.62684 18 29191 20.02359 21.82453 23 69751 25.84541 27 67123 29.77808 3424797 39.08260 44 31174 49.96758 56 08494 1.00000 2.05000 3.15250 431013 5.52563 6.80191 8.14201 9.54911 1102656 12.57789 14.20679 15.91713 17.71298 1959863 21.57856 23.65749 25.84037 28.13238 30.53900 33 06595 38 50521 44.50200 51.11345 58 40258 66.43885 1.00000 206000 3.18360 437462 5.63709 6.97532 8.39384 9.89747 11.49132 13.18079 1497164 16 86994 18.88214 21.01507 23.27597 25.67253 28 21288 30.90565 33.75999 36.78559 43 39229 50 81558 59.15638 68 52811 79.05819 1.00000 2.07000 3.21490 4.43994 5.75074 7.15329 8.65402 10.25980 11.97799 13.81645 15.78360 17 88845 20.14064 22.55049 25.12902 27 88805 30.84022 33 99903 37 37896 40.99549 49.00574 58.17667 68 67547 80.69769 94.46079 1.00000 2 08000 3.24640 4,50611 5.86660 733593 8.92280 10.63663 12.48756 14.48656 16.84549 18 97713 21.49530 24 21492 27.15211 30 32428 33.75023 37.45024 41.44626 45.76196 55 45676 68.76476 79.95442 95 33883 113.28321 1.00000 1.00000 2,10000 2.12000 3.31000 337440 464100 4.77933 6.10510 635285 771561 8.11519 948717 10.08901 11 43589 12.29989 13.57948 14.77560 15.93742 17 54874 18.53117 2065458 21 38428 24.13313 24.52271 28.02911 27 97498 32 39260 31.77248 37 27971 35 94973 42.75328 40.54470 48.88367 45 59917 55.74971 51.15909 63 43968 57 27500 7205244 71.40275 92.50258 88.49733 118.15524 109.18177 150.33390 134 20994 19069889 164 49402 24133268 1.00000 2.15000 347250 499338 6.74238 8.75374 11.06680 13.72682 16.78584 20.30372 24 34928 29.00167 34 35192 40 50471 47 58041 55.71747 6507509 7583636 88 21181 102 44358 137.63164 184.16784 245.71197 32710408 434.74515 TABLE 9-2 Present Value of $1 (N) Periods 2% 5% 79 10% 12% 15% 1 2 3 98039 96117 94232 92385 4 90573 5 6 88797 7 8 9 10 11 12 13 97087 94260 91514 88849 36261 83748 81309 78941 .76642 74409 72242 70138 68096 66112 64180 62317 60502 58739 57029 55308 52100 49193 46309 43708 41199 96154 92456 88900 85480 8219 79031 75992 73069 70259 67556 64958 62480 60057 57748 55520 53391 51337 49363 47464 45630 42196 39012 30009 33348 30832 87056 85349 83676 B2035 B0426 78849 77303 75788 74301 72845 71416 70016 68643 67297 84684 52172 59758 57437 55207 95238 90708 86384 82270 78353 74622 71068 67684 64461 61391 58468 55684 53032 50507 48102 45811 43630 41552 39573 37689 34185 31007 28124 25509 23138 94340 89000 83962 79200 74726 70496 66506 62741 59190 55839 52679 49697 46880 44230 41727 39365 37136 35034 33051 31180 27751 24608 21981 1953 17411 93458 87344 81630 76290 71290 60634 62275 58201 54393 50835 47509 44401 41495 38782 .38245 33873 31657 29586 27051 25842 22571 19715 17220 15040 13137 92593 85734 79383 73503 68058 63017 58349 54027 50025 46319 42888 39711 35770 34046 31524 29189 27027 25025 23171 21455 18394 15770 13520 11591 09938 90909 82645 75131 88301 .62092 56447 51316 46651 42410 38554 35049 31863 28966 26333 23939 21763 19784 17980 16351 14864 12285 10153 08391 06934 05731 89286 79719 21178 83552 56743 50663 45235 40388 36061 32197 28748 25668 22917 20462 18270 16312 14564 13004 11611 10367 08264 06588 05252 04187 03338 86957 75614 65752 57175 49718 43233 37594 32890 28426 24718 21494 18091 16253 14133 12289 10686 09290 08081 07027 06110 04620 03430 02642 01997 01510 14 15 16 17 18 19 20 22 24 26 28 30 . 2% 15" TABLE 9-1 Future Value of $1 IN) Periods 3% 1 1.02000 103000 2 1.04040 1.00090 3 106121 1.09273 4 1.08243 1.12551 5 1.10408 1.15927 6 1.12616 1.19405 7 1.14889 122987 8 1.17106 126677 9 1.19509 130477 10 1.21899 134392 11 1.24337 138423 12 1.26824 142578 13 129361 146853 14 131948 1.51259 15 1.34587 1.55797 16 1.37279 1.60471 17 1.40024 165285 18 1.42825 1.70243 19 145681 1.75351 20 148596 1.80611 22 1.54598 1.91610 24 1.60844 203279 26 1.67342 2.15650 28 174102 228790 30 181136 2.42726 1.04000 108160 1.12486 1.16986 121605 126532 1.31593 138857 142331 1.48024 153945 1.60100 166507 1.73168 1 80094 1.87298 1 94790 202582 2.10685 2.19112 236992 256330 277247 299870 3.24340 5% 105000 1.10250 1.15763 1.21551 1.27628 134010 1.40710 147746 1.55133 1.82889 1.71034 1.79586 188565 1.97990 2.07890 2.18287 229202 2.40662 2.52695 2.65330 2.92520 3.22510 3.55567 392013 432194 1.00000 1.12360 1.19102 1.25248 1.33823 141852 1.50363 1.59385 168948 1.79085 1 89830 201220 2.13293 2.26090 239656 254035 269277 285434 3.02500 3.20714 3.60354 4,04893 454938 5.11169 5.74349 7% 1.07000 1.14490 1. 22504 1.31080 1.40255 1.50073 1.80578 1.71819 1.63846 1.96715 210485 2.25219 2.40985 2.57853 275903 2.85216 315882 3.37993 3.61653 3.86968 443040 5.07237 5.80735 6.84884 7.61226 1.08000 1.16640 1.25971 138049 1.48833 1.58687 1.71382 185093 1 99900 2.15892 233184 251817 271962 2.93719 3.17217 342594 3.70002 3.93602 431570 4.66096 5.43654 6.34118 739635 8.62711 10.06266 10%. 1.10000 121000 133100 1.46410 1 61051 1.77156 1 94872 2.14359 235795 259374 285312 3.13843 345227 3.79750 4.17725 459497 505447 555992 6.11591 6.72750 8.14027 9.84973 1191818 14.42099 17.44940 12 1.12000 1.25440 140493 157352 1.76234 1.97382 2.21068 2.47586 2.77308 3.10585 3.47855 3.89588 4.38319 488711 547357 6.13039 6 88004 7.68997 8.61270 9.64629 12.10031 15.17853 19.04007 23 88387 29.95982 1.15000 132250 152088 1.74901 201136 231306 206002 3.05902 351788 401556 465239 535025 6.15279 7.07571 8 13706 9.35752 10.78126 1237545 14 23177 16 36654 21.64475 28.62518 37.85680 50.06561 56.21177