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- How would an increase in the interest rate effect the present value of an annuity problem (all other variables remain the same)2. What happens to domestic investment as the real interest rate rises? Explain your answerHow would an increase in the interest rate or a decrease in the number of periods until the payment is received affect the present value (PV) of a sum of money? Please explain properly. Thank you!
- What can you calculate with the Excel argument FV? Number of periods of time for a loan or investment. Interest rate. Future value of an investment based on a constant interest rate. The constant periodic payment required to pay off a loan or investment.Which of the following affects the present value of an investment? The type of investment (annuity versus single lump sum) The number of time periods (length of the investment) The interest rate All of the above2. How might a sudden increase in people's expectations of future real estate prices affect interest rates?
- For any investment, which will always have the higher future value : an ordinary annuity or an annuity due? For any debt, which will always have a higher future value: an ordinary annuity or an annuity due?Which of the following is not needed to compute the present value of an investment?a. The length of time between the investment and future receiptb. The interest ratec. The rate of inflationd. The amount of the receipTWhich of the following affects the present value of an investment? a. The type of investment (annuity versus single lump sum) b. The number of time periods (length of the investment) c. The interest rate d. All of the above
- 20. What is X in the formula: FV = X(1+r) ? Select one: a. The future value of an annuity with X cash flows b. The present value of a single cash flow in one period's time c. The future value of a single cash flow in one period's time d. The present value of an annuity with X cash flowsHow to find the initial interest rate? for first investment? How to find value of second investemnt?Investment A is an annuity and Investment B is an annuity due. All else equal, which one will have the lower present value? Select one: a. A b. A=B c. B