Principles of Finance
MULTIPLE CHOICE. Choose the one alternative that best completes the statement or answers the question.
1) If you borrow $50,000 at an annual interest rate of 12% for six years, what is the annual payment
(prior to maturity) on
1. Different Cash Flow. Given the following cash inflow at the end of each year, what is the
future value of this cash flow at 6%, 9%, and 15% interest rates at the end of the seventh
Year 1: $15,000
Year 2: $20,000
Year 3: $30,000
Years 4 through 6
Future Values. Fill in the future values for the following table,
a. using the future value formula, FV = PV (1 + r)n.
b. using the time value of money keys or function from a calculator or spreadsheet.
Chapter 3Present Value
1. Which of the following cannot be calculated?
a. Present value of an annuity.
b. Future value of an annuity.
c. Present value of a perpetuity.
d. Future value of a perpetuity.
REF: 3.4 Present Value o