In general, which rate yields the larger amount in one year? (A) 12% compounded yearly (B) 11.82% compounded semi-annually Input A or B or same here: same indicates the rates yield the same amount after one year

Q: Compute the effective annual rates for the following:a. 2 percent compounded yearly.b. 2 percent…

A: Effective annual interest rate ( EAIR ) = [{1 + ( r ÷ n )} ^ n] - 1, r= interest rate n= period  a.…

Q: Rounded to the nearest cent, find the amount of money accumulated in 5 years if $14000 is invested…

A: Given information: Present value amount is $14,000 Number of years is 5 years Interest rate is 10%

Q: It value of in two years, at 12% compounded annualy, is (rounded to nearest dollar). Use the…

A: Present Value The value in the present of a sum of money, in contrast to some future value it will…

Q: Consider the case where the Annual Percentage Rate (APR) is 15%. If the frequency of compounding is…

A: Annual Percentage rate = 15% Compounding = Quarterly Number of compounding per year = 4

Q: The following investment requires table factors for periods beyond the table. Using Table 11-1,…

A: The future value of the annuity is the future worth of a cash flow series at a certain rate of…

Q: If an investment increases from P40,000 to P50,612 in 3 years, what is the nominal rate of interest…

A: Investment amount (PV) = P 40,000 Future value (FV)  = P 50,612 Period = 3 Years Period in semi…

Q: 4. If P3,200 is invested for 1 year at 9% compounded monthly, what is the compound interest on the…

A: In this question, we are required to compute the compound interest.   Compound interest: Compound…

Q: An investment of $12,000 was growing at 3.5% compounded semi-annually. a. Calculate the accumulated…

A: a. A = P (1+r÷n )nt Where, A = Accumulated Value P = Investment Amount ($ 12,000) r = Rate of…

Q: The following investment requires table factors for periods beyond the table. Using Table 11-1,…

A: Given: Amount = $16,000 Interest rate = 7% Periods = 29

Q: c. A series of quarterly payments of $1000 for 25 years is economically equivalent to what present…

A: Quarterly Interest Rate = Annual Rate / 4 Quarters = 8% / 4 = 2%.Number of Quarters in 25 Years = 25…

Q: What annual rate of return is earned on a $1,000 investment when it grows to $2,700 in eight years?…

A: Return can be calculated as: Return = Closing Value - Opening ValueOpening Value Substituting the…

Q: At what per annum rate must $232 be compounded monthly for it to grow to $617 in 10 years?

A: EXCEL FORMULA:

Q: A sum of money invested now at 10 percent compounded semi-annually is to provide payments of $1500…

A: Let the money to be invested now = X Semiannual payment (A) = $1500 Number of payments (n) = 16 r =…

Q: earns an annual interest rate of 12 percent compounded Semi annually. What is the effective annual…

A: The given problem can be solved using EFFECT function in excel. EFFECT function computes effective…

Q: PLEASE, PERFORM THE EXERCISE IN EXCEL AND SHOW THE FORMULAS Problem 1 Find the final value (FV or…

A: Future Value(FV) or Final Value is the worth of current invested amount after certain period of…

Q: $3,000 is invested at 8%p.a compounding semi-annually for the first 3 years and at 13% p.a…

A: The compounding method is an important technique of the time value of money. The compounding…

Q: What annual rate of return is earned on a $5,000 investment when it grows to $9,000 in five years?…

A: We need to use the concept of time value of money to solve the question. According to the concept of…

Q: How many years are required for P 1,000 to increase to P 2,000 if invested at 9% per year compounded…

A: Future value is obtained by compounding the present value using the appropriate rate of interest.

Q: What is the present value of annual payments of $2,000 for 12 years at 1 percent?

A: Present Value of Annuity is that amount which was invested by the investor today for receiving the…

Q: If $17,500 is invested at an interest rate of 10% per year, find the value of the investment at the…

A: Present Value (PV)= $17,500 Interest Rate (r)= 10% per year Time period (n)= 5 years Future Value at…

Q: or total yearly payments of $10000 for 10 years, compare the compound amount accumulated at the end…

A: Given information: Annual payments : $10,000 Time periods : 10 years Nominal Rate of interest : 20%

Q: Suppose that $2700 is invested in an account with an APR of 3.9% compounded continuously. Determine…

A: Future value = Present value*e^rate*time

Q: Using Table 11-1, compute the amount of compound interest (in $) earned in 1 year and the annual…

A: Principle amount = 32000 Interest rate = 12% (Compounded monthly) Time period = 1 year

Q: Solve for the future value of $1,300 after 1 year invested at 4 percent if compounding is a) annual.…

A: Future value is the value of present investment in the future after compounding the present…

Q: how many years is required for $3,000 to increase by $4,000 if interest at 14% compounded quarterly

A: Investment can be defined as depositing funds in an asset to earn a profit or interest. Interest is…

Q: What annual rate of return is earned on a $1,000 investment when it grows to $2,700 in eight years?…

A: A concept through which it is studied that the current worth of money is higher than its future…

Q: The following investment requires table factors for perlods beyond the table. Using Table 11-1,…

A: The future value is the future worth of a cash flow at a certain rate of interest and time period.…

Q: Find the compound amount if P5,000 is invested at 10% compounded semi-annually for 2 years.

A: Compund Amount = PV * (1 + r/n)^ntWhere PV = Present Value  = P5,000r = rate of interest = 10%n=…

Q: What is the present value of $1,552.90 due in 10 years at (1) a 12 percent discount rate and (2) a 6…

A: Compute present value of $1,552.90 due in 10 years at 12% discount rate as shown below:

Q: If 36,400 dollars is invested at an interest rate of 7 percent per year, find the value of the…

A: The future value is the future worth of the amount that will be paid or received in the future.

Q: Using Table 11-1, compute the amount of compound interest (in $) earned in 1 year and the annual…

A: Compound interest and simple interest are the two types of interest that either of them can be…

Q: The following investment requires table factors for periods beyond the table. Using Table 11-1,…

A: Compounding is a technique which is used to get the FV of present amount by considering appropriate…

Q: Future value) To what amount will ​$4,900 invested for 9 years at 11 percent compounded annually…

A: Future value will be reflective of the value of present investment in future after compounding it…

Q: An investment provides a post-tax revenue stream of $20,323 semi-annually. What is the present value…

A: Post tax revenue stream (P) = $20,323 Semi-annual discount rate (r) = 3.07% (6.14%/2), semi-annual,…

Q: At an effective annual interest rate i, the present value of S10 per year, payable at the beginning…

A: In finance, the time value of money rule states that the sum of money today has more purchasing…

Q: what is the average EAR on an investment that earns 6% APR with monthly compounding for 5 years,…

A: The EAR is calculated for the compounded interest which shows the single rate that will provide same…

Q: A certain end of year cash flows are expected to be P 7,000.00 at the end of the  3rd year, P…

A: Present value: Present value is the future cash flow at a specific discount rate. The time value…

Q: compute the amount of compound interest (in $) earned in 1 year and the annual percentage yield…

A: Compound Interest is the interest that is calculated on the initial principal and on the interest…

Q: Calculate if $10,000 is invested at interest rate of 12% per annum, what is the amount after 3 years…

A: The provided information are: Present value (PV) = $10,000 Interest rate (r) = 12% = 0.12 Number of…

Q: Given the nominal rate of 12% per year compounded continuously, find a) Effective interest rate per…

A: When money is borrowed or lent, the concept of interest charge is an important one. The interest may…

Q: Using Table 11-1, compute the amount of compound interest (in $) earned in 1 year and the annual…

A: Given, Principal amount $33,000. Nominal rate=12%.

Q: A year-end bonus of $23,000 will generate how much money at the beginning of each month for the next…

A: Present Value:  The present value is the value of cash flow stream or the fixed lump sum amount at…

Q: In general, which rate yields the larger amount in one year? (A) 13% compounded semi-annually (B)…

A: The rate that would yield a higher value can be calculated by comparing the effective annual rate of…

Q: What is the future worth of the following seriesof payments?(a) $75,000 at the end of each six-month…

A: Present value is the sum of money that must be invested in order to achieve a specific future goal.…

Q: Calculate the future value of the following single amounts.   Initial Investment Annual Rate…

A: Future value: It can be defined as the value of an investment or any asset at a specified future…

Q: alculate, to the nearest cent, the future value FV (in dollars) of an investment of $10,000 at the…

A: The future value of a single sum deposited can be calculated by using this equation Future value…

Q: Find the present value of the following annuities 800 starting at time 1, decreasing by 50 annually…

A: Annuity is a series of regular payments being made for a specified period. When the payments are at…

Present Value

Present value (PV) is defined as the current or present value of all future sums of cash flow or money at a specified rate of return. This rate of return is known as the discounted rate, which is essentially the interest rate, discounted over some time. The expected cash flows are discounted at a discount rate to compute the present value. The higher the discount rate, the higher the future value (FV), but the lower the present value.