10. Time Value of Money

Given a cash flow of \$1,000 to be received at the end of year 3 and a discount rate of 8\% per year, what is the present value of this year 3 cash flow?

All of the following are true statements regarding the accumulation at interest option except:

If you earn an annual interest rate of 6.9\% compounded annually, approximately how many years will it take to double your savings?

When interest accrues and is added to the principal balance of a student loan, which of the following best describes the result?

Which of the following investment criteria takes the time value of money into consideration?

A project that provides annual cash flows of \$5,000 for 4 years, with a required rate of return of 8\%, has a present value closest to which of the following amounts?

Given a present value (PV), an annual interest rate \(r\), and \(n\) years, what is the correct formula to calculate the future value (FV)?

Interest rates are generally expressed as a(n) _____ of the loan.

If \$1 is compounded semiannually for 5 years at an annual interest rate of 2%, how many compounding periods will there be in total?

Given the following cash flow stream: \$1,000 at the end of Year 1, \$1,500 at the end of Year 2, and \$2,000 at the end of Year 3, what is the future value at the end of Year 3 if the interest rate is 6.5% compounded annually?

Janet takes out a loan of \$10,000 at an annual interest rate of 6ext{%}, to be repaid in equal monthly installments over 5 years. By the time Janet pays off her entire loan, how much total interest will she have paid?

Which of the following formulas correctly represents the future value of an ordinary annuity with periodic deposits of \(P\), interest rate \(r\) per period, and \(n\) periods?

Which time value of money function calculates the total principal paid through a specified number of payments?

If Janet increases her monthly loan payment while keeping the interest rate and loan amount constant, what will be the impact on the number of months it will take her to pay off her loan?

What is the future value of \$1 invested today at an annual interest rate of \(r\) for \(n\) periods, compounded once per period?