Question

Solve for the unknown number of years in each of the following: (Do not round intermediate calculations and round your answers to 2 decimal places, e.g., 32.16.) 

For each of the following, compute the present value: (Do not round intermediate calculations and round your answers to 2 decimal places, e.g., 32.16.) 

Answer 1

1) t = ln(FV / PV) / ln(1 + r)

t = ln($1,305 / $450) / ln 1.08 = 13.83 years

t = ln($3,900 / $2,141) / ln 1.06 = 10.29 years

t = ln($389,120 / $33,205) / ln 1.11 = 23.58 years

t = ln($204,260 / $32,900) / ln 1.18 = 11.03 years

2) PV = FV / (1 + r)^t

PV = $19,128 / (1.06)¹⁰ = $10,680.98

PV = $43,317 / (1.11)² = $35,157.05

PV = $808,382 / (1.14)¹⁴ = $129,106.68

PV = $665,816 / (1.13)¹⁹ = $65,292.58