Scribd Logo
Upload

Welcome to Scribd!

  • 52 views

    13 Q2 Fall 11

    Uploaded by

    Jamie Woods
    This document provides information on time value of money calculations, including equations in factor notation for present value calculations. It includes a cash flow diagram and questions asking to write the present value equation in factor notation and calculate the present value for a given interest rate. Key equations presented are the present value, future value, and annuity formulas in factor notation.

    Copyright:

    Attribution Non-Commercial (BY-NC)
    Download as PDF, TXT or read online from Scribd
    Flag for inappropriate content

    You might also like

    13 Q2 Fall 11

    Uploaded by

    Jamie Woods
    52 views2 pages
    This document provides information on time value of money calculations, including equations in factor notation for present value calculations. It includes a cash flow diagram and questions asking to write the present value equation in factor notation and calculate the present value for a given interest rate. Key equations presented are the present value, future value, and annuity formulas in factor notation.

    Original Description:

    Original Title

    13Q2Fall11

    Copyright

    © Attribution Non-Commercial (BY-NC)

    Available Formats

    PDF, TXT or read online from Scribd

    Did you find this document useful?

    Is this content inappropriate?

    Report this Document
    This document provides information on time value of money calculations, including equations in factor notation for present value calculations. It includes a cash flow diagram and questions asking to write the present value equation in factor notation and calculate the present value for a given interest rate. Key equations presented are the present value, future value, and annuity formulas in factor notation.

    Copyright:

    Attribution Non-Commercial (BY-NC)
    Download as PDF, TXT or read online from Scribd
    Flag for inappropriate content
    Download as pdf or txt
    52 views2 pages

    13 Q2 Fall 11

    Uploaded by

    Jamie Woods
    This document provides information on time value of money calculations, including equations in factor notation for present value calculations. It includes a cash flow diagram and questions asking to write the present value equation in factor notation and calculate the present value for a given interest rate. Key equations presented are the present value, future value, and annuity formulas in factor notation.

    Copyright:

    Attribution Non-Commercial (BY-NC)
    Download as PDF, TXT or read online from Scribd
    Flag for inappropriate content
    Download as pdf or txt
    of 2

    EC 314: Public and Private Investment Fall 2011 Q2: Time Value #13

    PASS Name:

    NO PASS

    (F |P, i, N ) (P |A, i, N ) (P |G, i, N ) (P |A1 , g, i, N )

    F = P (1 + i)N P =A P = P =
    (1+i)N 1 i(1+i)N (1+i)N iN 1 G i2 (1+i)N 1(1+g)N (1+i)N A1 ig

    or P = A1

    N 1+i

    if : i = g Not Factor Note

    Consider the following cash ow diagram.


    20 15

    20

    Cash Flow

    10 5 0 0

    10 5 2.5
    2

    1.251.251.251.251.251.25
    4 6 8

    Period
    O By 1. Write an equation, in factor notation, that describes the present worth of this cash One

    ow sequence.

    2. Write an equivelent equation in factor notation, i.e., decompose the cash ow dierently.

    3. Calculate the present worth of this series when the interest rate is 10.00%?

    Answer Key
    1. Answer: See Video 2. Answer: See Video 3. Answer: The present worth is 39.1916422797354

    You might also like