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Unformatted text preview: 6 Compound Interest 7 Present Value Example: You need to set aside enough to make a tuition payment of $7,000 one year from now. How much must you set aside if the money is placed in a savings account at 3% per year? 8 Present Value (II) Assume that your parents are making the same calculation for your sibling’s (who is just starting high school) first tuition payment. 9 Financial Calculators Example: Calculate the PV of $100,000 to be paid 10 years from now if the interest rate is 5.47% per year. 10 10 Example: Calculate the FV of $10,000 invested at 6.33% per year for 10 years. Financial Calculators 11 11 Solving For k Or n Example: Assume you have $1,200 to invest and want to know how long it will take for that sum to grow to $3,000 if invested in a CD at 7%: 12 12 Solving For k Or n Example: Assume you have $1,200 to invest and want to know how long it will take for that sum to grow to $3,000 if invested in a CD at 7%:...
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This note was uploaded on 02/14/2011 for the course FINA 363 taught by Professor Masoudie during the Fall '10 term at South Carolina.
 Fall '10
 Masoudie
 Finance, Future Value, Interest, Interest Rate

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