- The Future Worth of $1 factor is used to:
- The Present Worth of $1 factor:
- The Present Worth of $1 Per Period factor is used to:
- The Present Worth of $1 Per Period and Present Worth of $1 factors are the basis of yield capitalization (discounted cash flow analysis).
- The Sinking Fund Factor is used to determine the amount of money that must be set aside each period in order to meet a future monetary obligation.
- The Periodic Repayment factor is used to:
- Find the Present Worth of $1 factor at an annual interest rate of 7.00% for 10 years, assuming annual compounding.
- Find the Present Worth of $1 Per Period factor at an annual interest rate of 7.00% for 10 years, assuming annual compounding.
- You have $450,000 to invest. If you can earn an annual interest rate of 7.00%, how much would you accumulate in 10 years, assuming annual compounding?
- You plan to invest $2,000 in an Individual Retirement Account at the end of each year for the next 5 years. If the IRA earns an annual interest rate of 4.00%, how much will you have at the end of the 5 years, assuming annual compounding?
- You borrow $50,000 today and will repay the loan with equal monthly payments for 2 years at an annual interest rate of 12.00%. What is the monthly payment amount?
- You invest $8,000 today at an annual rate of 6.00%, assuming monthly compounding. How much will you have after 3 years?
- You expect 4 payments of $3,000 at the end of each of the next 4 years. At an annual interest rate of 6.00%, assuming annual compounding, what is the present value of the expected future payments?
- How much should you deposit today in order to have $10,000 in 5 years? Assume an annual interest rate of 5.50%, with monthly compounding.
- You expect to receive payments of $15,000 at the end of each year for the next 10 years. Assuming an annual interest rate of 4.00%, with annual compounding, how much would that stream of payments be worth today?
- You expect to replace the roof of your investment property in 15 years at an estimated cost of $800,000. If you can earn an annual interest rate of 4.00%, how much should you deposit at the end of each year in order to fund the roof replacement?
- How much would you have to deposit now in order to have $15,000 in 8 years, given an annual interest rate of 7.00%, with annual compounding?
- Someone promises to pay you $25,000 five years hence. If the annual interest rate is 6.00%, assuming annual compounding, how much would you pay for this promise today?
- You want to save $8,000 so that you can buy a new (used) car. If you deposit $185.71 every month, beginning in one month, in an account that pays 12.00% interest per year, with monthly compounding, how long will you be saving for your car?
- John deposits $200 today in an account that pays an annual interest rate of 5.00%, with annual compounding. How much will John have in the account at the end of 10 years, assuming no withdrawals?
- A property generates $15,000 at the end of each year over a 7-year period. The income is deposited into an account that pays interest of 6.00 percent, compounded annually. How much will be in the account after the 7 years?
- In 10 years, the owner of an apartment building expects to upgrade the HVAC system at a cost of $40,000. To accumulate the funds, she plans to make monthly deposits into an account pays an annual rate of 8.00% (monthly compounding). How much does she need to deposit each month?
- An investor acquires an income-producing property. The property's expected annual net income is $30,000 at the end of each year over an 8-year holding period. If the investor requires an annual rate of return of 5.00% (annual compounding), what is the present value of the expected future income stream (i.e., the estimated value of the property)?
- A property owner leases an office building for ten years at $20,000 per year, with the tenant paying all expenses. The investor requires an annual rate of return 7.00% (annual compounding). What is the present value of the lease payments to the lessor?
- A buyer must borrow $200,000 to complete the purchase of a commercial property. The interest rate on the loan is 5.00%, and the term is 30 years with monthly payments. What is the buyer's monthly payment?