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Capstone Check point finance

# Capstone Check point finance - Name Georgia Moore Date...

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Name: Georgia Moore Date: 04/12/2011 Assignment: Present Value, Future Value, and Annuity Dues 3. You will receive \$5,000 three years from now. The discount rate is 8 percent. A. What is the value of your investment two years from now? Multiply \$5,000 _ .926 (one year’s discount rate at 8 percent). FV = 5,000 Rate= 8% N= 1 year PV= unknown PV = FV x PVIF/8% ^ 1 = 5,000 x 0.926 = 4,630 B. What is the value of your investment one year from now? Multiply your answer to part a by .926 (one year’s discount rate at 8 percent). FV= 4,630 Rate= 8% N = 1 year PV= unknown PV = FV x PVIF/8% ^ 1

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= 4,630 x 0.926 = 4,287.38 C. What is the value of your investment today? Multiply your answer to part b by .926 (one year’s discount rate at 8 percent). FV= 4,287.38 Rate= 8% N= 1 year PV = unknown PV = FV x PVIF/8% ^ 1 = 4,287.38 x 0.926 = 3,970.11 D. Confirm that your answer to part c is correct by going to Appendix B (present value of \$1) for n _ 3 and i _ 8 percent. Multiply this tabular value by \$5,000 and compare your
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Capstone Check point finance - Name Georgia Moore Date...

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