Unformatted text preview: $5,444.67 therefore choose 5 in years f) PV = FV / (1+r)^t = $3,000 / (1+.07)^4 = $2,288.69 g) FVA = CF[{(1+r)^t – 1} / r] = $1,200[{(1+.09)^15 – 1} / 0.09] = $35,233.10 FVA = CF[{(1+r)^t – 1} / r] = $1,200[{(1+.10)^15 – 1} / 0.10] = $38,126.98 The difference is 2,893.88 4) a) PV = $30,000.00 b) PV = FV / (1+r)^t = $40,000 / (1+.05)^5 = $31,341.05 c) PV = FV / (1+r)^t = $10,000 / (1+.05) + $25,000 / (1.05)^3 = $31,119.75 d) PVA = CF[{1 – 1 / (1+r)^t}/r] = $4,000 [{1 – 1 / (1.05)^10}/.05] = $30,886.94 + $4,000 = $34,886.94 5) a) 72/2 = 36 years b) 72/4 = 18 years c) 72/6 = 12 years d) 72/8 = 9 years e ) 72/10 = 7.2 years...
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 Spring '08
 DelCorral
 Personal Finance, ^t

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