Chapter 6 13th Edition Brief Exercises

Chapter 6 13th Edition Brief Exercises - CHAPTER 6...

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Unformatted text preview: CHAPTER 6 SOLUTIONS TO BRIEF EXERCISES BRIEF EXERCISE 6-1 8% annual interest i = 8% PV = $15,000 FV = ? 0 1 2 3 n = 3 FV = $15,000 (FVF 3, 8% ) FV = $15,000 (1.25971) FV = $18,895.65 8% annual interest, compounded semiannually i = 4% PV = $15,000 FV = ? 0 1 2 3 4 5 6 n = 6 FV = $15,000 (FVF 6, 4% ) FV = $15,000 (1.26532) FV = $18,979.80 BRIEF EXERCISE 6-2 12% annual interest i = 12% PV = ? FV = $25,000 0 1 2 3 4 n = 4 PV = $25,000 (PVF 4, 12% ) PV = $25,000 (.63552) PV = $15,888 12% annual interest, compounded quarterly i = 3% PV = ? FV = $25,000 0 1 2 14 15 16 n = 16 PV = $25,000 (PVF 16, 3% ) PV = $25,000 (.62317) PV = $15,579.25 BRIEF EXERCISE 6-3 i = ? PV = $30,000 FV = $150,000 0 1 2 19 20 21 n = 21 FV = PV (FVF 21, i ) PV = FV (PVF 21, i ) OR $150,000 = $30,000 (FVF 21, i ) $30,000 = $150,000 (PVF 21, i ) FVF 21, i = 5.0000 PVF 21, i = .20000 i = 8% i = 8% BRIEF EXERCISE 6-4 i = 5% PV = $10,000 FV = $17,100 0 ? n = ? FV = PV (FVF n, 5% ) PV = FV (PVF n, 5% ) OR $17,100 = $10,000 (FVF n, 5% ) $10,000 = $17,100 (PVF n, 5% ) FVF n, 5% = 1.71000 PVF n, 5% = .58480 n = 11 years n = 11 years BRIEF EXERCISE 6-5...
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Chapter 6 13th Edition Brief Exercises - CHAPTER 6...

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