Single-Sum Problems Present Value Future Value? $10,000 X 0 1 2 3 4 5 6 BE6-1 Steve Allen invested $10,000 today in a fund that earns 8%compounded annually.To what amount will the investment grow in 3 years? What table do we use? Chapter 6-16 LO 5 Solve future and present value of 1 problems
Chapter 6-16 BE6-1 Steve Allen invested $10,000 today in a fund that earns 8% compounded annually. To what amount will the investment grow in 3 years? 0 1 2 3 4 5 6 Present Value $10,000 What table do we use? Future Value?
Single-Sum Problems Table 6-1 Number of Discount Rate Periods 2% 4% 6% 8% 10% 1 1.02000 1.04000 1.06000 1.08000 1.10000 2 1.04040 1.08160 1.12360 1.16640 1.21000 3 1.06121 1.12486 1.19102 1.25971 1.33100 4 1.08243 1.16986 1.26248 1.36049 1.46410 5 1.10408 1.21665 1.33823 1.46933 1.61051 What factor do we use? Chapter 6-17 LO 5 Solve future and present value of 1 problems
Chapter 6-17 Number of Discount Rate Periods 2% 4% 6% 8% 10% 1 1.02000 1.04000 1.06000 1.08000 1.10000 2 1.04040 1.08160 1.12360 1.16640 1.21000 3 1.06121 1.12486 1.19102 1.25971 1.33100 4 1.08243 1.16986 1.26248 1.36049 1.46410 5 1.10408 1.21665 1.33823 1.46933 1.61051 What factor do we use?
Single-Sum Problems Table 6-1 Number of Discount Rate Periods 2% 4% 6% 8% 10% 1 1.02000 1.04000 1.06000 1.08000 1.10000 2 1.04040 1.08160 1.12360 1.16640 1.21000 3 1.06121 1.12486 1.19102 1.25971 1.33100 4 1.08243 1.16986 1.26248 1.36049 1.46410 5 1.10408 1.21665 1.33823 1.46933 1.61051 $10,000 X 1.25971 $12,597 Present Value Factor Future Value Chapter 6-18 LO 5 Solve future and present value of 1 problems
Chapter 6-18 Number of Discount Rate Periods 2% 4% 6% 8% 10% 1 1.02000 1.04000 1.06000 1.08000 1.10000 2 1.04040 1.08160 1.12360 1.16640 1.21000 3 1.06121 1.12486 1.19102 1.25971 1.33100 4 1.08243 1.16986 1.26248 1.36049 1.46410 5 1.10408 1.21665 1.33823 1.46933 1.61051 $10,000 x 1.25971 = $12,597 Present Value Factor Future Value