Current Attempt in ProgressFor each of the following cases, indicate (a) to what interest rate columns and (b) what number of periods you would refer to in lookingup the future value factor.(1) In Table 1 (future value of 1):Case ACase BCase ACase BCase ACase BCase AAnnual RateCase B4%10%(2) In Table 2 (future value of an annuity of 1):(a)Annual Rate4%10%Number ofYears Invested(a)6%12%Number ofYears Invested10%CompoundedAnnuallySemiannually(b)CompoundedAnnuallySemiannuallyI(b)periodsperiodsperiodsperiods

The Time Value of Money (TVM) is a fundamental financial concept that underscores the idea that a…

Case A Case B (2) In Table 2 (future value of an annuity of 1): Case A Case B Case A Case B Annual Rate 4% 10% Number of Years Invested 12 10 % Compounded Annually Semiannually (b) periods periods periods

Case A Case B (2) In Table 2 (future value of an annuity of 1): Case A Case B Case A Case B Annual Rate 4% 10% Number of Years Invested 12 10 % Compounded Annually Semiannually (b) periods periods periods

Essentials Of Investments

11th Edition

ISBN:9781260013924

Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Chapter1: Investments: Background And Issues

Section: Chapter Questions

Problem 1PS

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For each of the following cases, indicate (a) to what rate columns, and (b) to what number of periods you would refer in looking up the interest factor. 1. In a future value of 1 table: a. b. C. a. b. Annual Rate C. 10% 12% 12% Annual Rate 12% 12% 8% Number of Years Invested Number of Years Invested 26 16 7 12 6 2. In a present value of an annuity of 1 table: (Round "Rate of Interest" answers to 1 decimal place, e.g. 4.5% and other answers to O decimal places, e.g 45.) 20 Number of Rents Involved 26 32 Compounded 28 Annually Quarterly Semiannually Frequency of Rents Annually Semiannually (a) Rate of Interest Quarterly % (a) Rate of Interest % % % % (b) Number of Periods % (b) Number of Periods
For each of the following cases, indicate (a) to what rate columns, and (b) to what number of periods you would refer in looking up the interest factor. 1. In a future value of 1 table: a. b. C. a. b. Annual Rate C. 11% 12% 12% Annual Rate 10% 11% 12% Number of Years Invested Number of Years Invested 25 14 6 11 7 2. In a present value of an annuity of 1 table: (Round "Rate of Interest" answers to 1 decimal place, e.g. 4.5% and other answers to O decimal places, e.g 45.) 19 Number of Rents Involved 25 28 Compounded 24 Annually Quarterly Semiannually Frequency of Rents Annually Semiannually (a) Rate of Interest Quarterly % (a) Rate of Interest % % % % de (b) Number of Periods % (b) Number of Periods
For each of the following cases, indicate (a) to what rate columns, and (b) to what number of periods you would refer in looking up the interest factor. 1. In a future value of 1 table: a. b. J C. a. b. Annual Rate C. 10% 8% 10% Annual Rate 9% 11% Number of Years Invested 12% 2. In a present value of an annuity of 1 table: (Round answers to 1 decimal place, e.g. 458,58.1.) Number of Rents Involved Number of Years Invested 29 16 10 7 7 20 29 32 Compounded 28 Annually Quarterly Semiannually Frequency of Rents Annually Semiannually (a) Rate of Interest Quarterly (a) Rate of Interest % % % % % % (b) Number of Periods (b) Number of Periods
For each of the following cases, indicate (a) what interest rate columns and (b) what number of periods you would refer to in looking up the future value factor. (1) In Table 1 (future value of 1): Number of Annual Rate Years Invested Compounded Case A 5% 5 Annually Case B 8% 6 Semiannually Case A Case B . (a) % % (2) In Table 2 (future value of an annuity of 1): Annual Rate Number of Years Invested Compounded Case A 6% 9 Annually Case B 8% 5 Semiannually Case A Case B (b) periods periods (a) (b) % periods % periods
Assume that you must estimate what the future value will be two years from today using the future value of 1 table. (PV of $1, EV of $1. PVA of $1, and FVA of $1) Which interest rate column and number-of-periods row do you use when working with the following rates? (Round percentage answers to 2 decimal places.) Answer is complete but not entirely correct. Number of Periods 1. 12% annual rate, compounded annually 2.8% annual rate, compounded semiannually 3. 12% annual rate, compounded quarterly 4. 12% annual rate, compounded monthly Interest Rate 12.00 2.00 3.00 1.00 % % % % 2 80 24
For each of the following cases, indicate (a) to what rate columns, and (b) to what number of periods you would refer in looking up the interest factor. 1. In a future value of 1 table: Annual Rate Number of Years Invested Compounded (a) Rate of Interest a. 9% 12 Annually b. 8% 7 Quarterly C. 12% 16 Semiannually % % % (b) Number of Periods 2. In a present value of an annuity of 1 table: (Round "Rate of Interest" answers to 1 decimal place, e.g. 4.5% and other answers to O decimal places, e.g 45.) Annual Number of Years Rate Invested Number of Rents Involved Frequency of Rents (a) Rate of Interest (b) Number of Periods a. 10% 28 28 Annually b. 10% 15 30 Semiannually % % 8% 7 28 Quarterly %
Calculate the future value of the following annuities, assuming each annuity payment is made at the end of each compounding period. (FV of $1. PV of $1, EVA of $1, and PVA of $1) (Use tables, Excel, or a financial calculator. Round your answers to 2 decimal places.) 1. Annuity Payment $ 3,700 Annual Rate Interest Period Compounded Invested Future Value of Annuity 7.0% Semiannually 9 years 2. 6,700 8.0% Quarterly 5 years 3. 5,700 12.0% Annually 6 years
For each of the following cases, indicate (a) to what rate columns, and (b) to what number of periods you would refer in looking up the interest factor.1. In a future value of 1 table: Annual Rate Number of Years Invested Compounded (a) Rate of Interest (b) Number of Periods a. 11% 10 Annually % b. 8% 8 Quarterly % c. 10% 19 Semiannually % 2. In a present value of an annuity of 1 table: (Round answers to 1 decimal place, e.g. 458,58.1.) Annual Rate Number of Years Invested Number of Rents Involved Frequency of Rents (a) Rate of Interest (b) Number of Periods a. 12% 30 30 Annually % b. 11% 16 32 Semiannually % c. 12% 8 32 Quarterly %
For each of the following cases, indicate (a) to what rate columns, and (b) to what number of periods you would refer in looking up the interest factor. 1. In a future value of 1 table: a. b. C. mpt in progress a. b. C. Annual Rate 10% 8% 10% Annual Rate 10% 11% 12% Number of Years Invested Number of Years Invested 26 16 7 11 6 2. In a present value of an annuity of 1 table: (Round "Rate of Interest" answers to 1 decimal place, e.g. 4.5% and other answers to O decimal places, e.g 45.) 18 Number of Rents Involved 26 32 Compounded 28 Annually Quarterly Semiannually Frequency of Rents Annually Semiannually (a) Rate of Interest Quarterly % (a) Rate of Interest % % % % (b) Number of Periods % (b) Number of Periods
For each of the following cases, indicate (a) to what interest rate columns and (b) what number of periods you would refer to in looking up the future value factor. (1) In Table 1 (future value of 1): \table||,Annual Rate, \table[[Number of], [Years Invested]], Compounded], [Case A,5%,5, Annually], [Case 8,8%, 4, Semiannually]]\ table[(a)..(b)], [Case A,%, periods,], [Case B,%, periods,,]] (2) In Table 2 (future value of an annuity of 1): \ table[],Annual Rate,\table[[Number of], [Years Invested]], Compounded], [Case A,4%, 12, Annually), (Case B,6%, 5,Semiannually]] \table[[,(a), (b)].[..%,periods], [Case A,%, periods,]]
Calculate the present value of the following annulties, assuming each annuity payment is made at the end of each compounding period. (FV of $1, PV of $1, FVA of $1, and PVA of S1) (Use tables, Excel, or a financial calculator. Round your answers to 2 decimal places.) \table[[, \table[[Annuity], [Payment]], \table [[ Annual], [Rate]], \table[[Interest], [Compounded]], \table [[Period], [Invested]], \table [[Present Value of], [ Annuity]]], [1., $5,000, 7.0%, Semiannually,3 years,], [2., 10, 000, 8.0%, Quarterly,2 years, ], [3., 4,000, 10.0 %, Annually,5 years,]]
Calculate the future value of the following annuities, assuming each annuity payment is made at the end of each compounding period. (FV of $1, PV of $1, FVA of $1, and PVA of $1) (Use appropriate factor(s) from the tables provided. Round your answers to 2 decimal places.) Annuity Payment Annual Rate Interest Compounded Period Invested Future Value of Annuity 1. $3,100 8.0 % Semiannually 9 years $79,500.77 2. 6,100 10.0 % Quarterly 5 years 3. 5,100 12.0 % Annually 6 years

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