10. Time Value of Money

Which of the following equations correctly calculates the future value ($FV$) of a single sum invested today ($PV$) for $n$ periods at an annual interest rate $r$, with interest compounded once per period?

How does a higher Annual Percentage Rate (APR) affect the monthly payments and total interest paid on a fixed-rate loan, assuming the loan amount and term remain the same?

If Ida invests $10 at an annual interest rate of 7% compounded annually, approximately how many years will it take for her investment to double?

If the five-year discount factor is $d$, which of the following expressions correctly represents the present value (PV) of $1$ to be received in five years?

What is the future value of $10 invested for 3 years at an annual interest rate of 5\% compounded annually?

How much will $1,000 be worth at the end of 2 years if the interest rate is 6% compounded daily?

If you invest $100 at an annual interest rate of 5\% compounded once per year, how much will it be worth after 75 years?

What is the primary purpose of interest in the context of time value of money equations?

Which of the following is true for calculating the future value of multiple cash flows?

How many years will it take for $20 to grow to $100 if the simple interest rate is 4\% per year?

Which one of the following methods of analysis ignores the time value of money?

If you desire your savings to double in 6 years, which annual interest rate, compounded annually, is closest to what you need?

Inga took out a $10,000 loan at an annual interest rate of 6%, to be repaid in equal annual installments of $1,500. After making payments for 4 years, how many more years will it take Inga to fully pay off the loan?

A project has the following cash flows:\[\begin{align*}\text{Year 0:} & \ -\$10,000 \\\text{Year 1:} & \ +\$4,000 \\\text{Year 2:} & \ +\$4,000 \\\text{Year 3:} & \ +\$4,000 \end{align*}\]What is the internal rate of return (IRR) for this project (rounded to the nearest whole percent)?

A certificate of deposit pays a higher interest rate than a savings account because the money is: