Question

The future value and present value equations also help in finding the interest rate and the number of years that correspond to present and future value calculations.

If a security currently worth $5,600 will be worth $8,228.24 five years in the future, what is the implied interest rate the investor will earn on the security-assuming that no additional deposits or withdrawals are made?

0	8.00%
0	6.40%
0	0.29%
0	6.81%

If an investment of $35,000 is earning an interest rate of 8.00%, compounded annually, then it will take _____________ years -for this investment to reach a value of $49,485.16- assuming that no additional deposits or withdrawals are made during this time.

Which of the following statements is true- assuming that no additiona l deposits or withdrawals are made?

A. An investment of $50 at an annual rate of 5% will return a higher value in five years than $25 invested at an annual rate of 10% in the same time.

B. An investment of $25 at an annual rate of 10% will return a higher value in five years than $50 invested at an annual rate of 5% in the same time.

Answer 1