Finance Questions

Submitted By landin1
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Ch. 5 Study Problems

Joseph R. Landini

University of Phoenix

FIN/370

Professor: Jim Hill

March 22, 2010

Chapter 5: Financial Management: Principles and Applications

5-1A A. \$5,000 invested for 10 years at 10 percent compounded annually: 5,000 10 years @ 10% = 12,968.71 B. \$8,000 invested for 7years at 8 percent compounded annually: 8,000 7 yrs. @ 8% = 13,710.59 C. \$775 invested for 12 years at 12 percent compounded annually: 775 12 yrs. @ 12% = 3,019.38 D. \$21,000 invested for 5 years at 5 percent compounded annually: 21,000 5yrs. @ 5% = 26,801.91

5-4A A. \$800 to be received 10yrs from now discounted back to the present at 10% = 308.43 B. \$300 to be received 5yrs from now discounted back to the present at 5% = 235.06 C. \$1,000 to be received 8yrs from now discounted back to the present at 3% = 789.41 D. \$1,000 to be received 8yrs from now discounted back to the present At 20% = 232.57

5-5A A. \$500 a yr for 10yrs compounded annually at 5% = 6603.30 B. \$100 a yr for 5 yrs compounded annually at 10% = 671.56 C. \$35 a yr for 7 yrs compounded annually at7% = 365.26 D. \$25 a yr for 3 yrs compounded annually at 2% = 78.04

5-6A A. \$2,500 a year for 10 yrs discounted back to the present at 7% = 17,558.95 B. \$70 a yr for 3 yrs discounted back to the present at 3 % = 198.00 C. \$280 a year for 7yrs discounted back to the present at 7 % = 1,563.07 D. \$500 a yr for 10 yrs discounted back to the present at 10% =…...

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