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Math 25 Worksheet 11 - Present and Future Values 1. For each of the following, give an expression that represents the indicated quantity. You do should integrate any integrals you get, but you do not otherwise need to simplify or evaluate the expression. You may assume that all the given interest rates are compounded continuously.
Present and Future Value Tables This table shows the future value of $1 at various interest rates ( i) and time periods ( n). It is used to calculate the future value of any single amount. TABLE 1 Future Value of $1 FV = $1 (1 + i ) n n / i
Present value and future value math is all about getting to an apples-to-apples comparison or an oranges-to-oranges comparison
Present Value of an Annuity. Why would we want to know the present value of an annuity? Well in some cases we would like to know how much money we should put away now (at the present time), so that at a later time we could withdraw a certain amount of money for a certain length of time.
Problem 1: Present value intra-year discounting. What is the present value of $1,000 received in two years if the interest rate is? (a) 12% per year discounted annually.
Objective: Understanding the process of what the “annuity” formulas (sections 6. 3 and 6.4) do when finding present value or accumulated value of a stream of periodic payments of $m. . NOTE: CHECKING YOUR WORK AND SHOWING ALL WORK .
Math 1313 Chapter 5 – Section 5.1 Simple Interest, Future Value, Present Value, and Effective Rate. Simple Interest is interest that is computed on the original principal only. Formula: I = Prt, where P is the principal, r is the interest rate and t is time (in years).
