This preview shows pages 1–3. Sign up to view the full content.
This preview has intentionally blurred sections. Sign up to view the full version.
View Full Document
Unformatted text preview: 1 ( 9 9 = + = FV How long at 9 percent? Guess 8 years. 9 X 8 = 72 9926 . 1 ) 09 . 1 ( 8 8 = + = FV N i = 72 Where N is the number of years, and i is the interest rate, expressed as a whole percentage number. Perpetuities How much money would you need, earning 7 percent interest to collect $100 per year forever? .07 PV = 100 PV = 1428.57 Annuities How much would you need earning 7 percent, to collect $ 100 per year for 5 years? Perpetuity = 1428.57 Perpetuity delayed 5 years = 1428.57(.7130) =1018.57 PV of 5 year annuity = 1428.57 1018.57 = 410.00 Use of calculator N= 5 PMT = 100 FV=0 I=7 CPT PV = 410.02...
View Full
Document
 Spring '09
 NOWACKI
 Time Value Of Money, Future Value

Click to edit the document details