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Unformatted text preview: years and the property has appreciated at a 12% annual rate. What did you originally pay for the property? 5. What is the net present value of the following annual cash flow (if the funds are discounted at 15%)? 1 2 3 (100) 150 (200) 500 6. You just took out a 30 year $400,000 loan to buy a house, the monthly payments are 2,661.21. What is the interest rate? Suggested Answers 1.) 1 year = $10,500; 2 years = $11,025; 5 years = $12,763; 20 years = $26,533 2.) 1 year = $72,727; 2 years = $66,116; 5 years = $49,674; 20 years = $11,891 3.) Approximately 140 months 4.) ($1,036,668) 5.) $207.96 6.) 7%...
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 Spring '12
 McCabe
 Net Present Value, Mathematical finance

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