Quiz # 1 (TVM)

What would the future value of $100 be after 5 years at 10% compound interest?

• $161.05

• $134.54

• $127.84

• $151.29

• $143.65

How much would $10,000 due in 100 years be worth today if the discount rate were 10%?

• $0.73

• $1.21

• $2.49

• $4.83

• $6.30

Sims Inc. earned $1.00 per share in 2000. Five years later, in 2005, it earned $2.00. What was the growth rate in Sims' earnings per share (EPS) over the 5-year period?

• 10.82%

• 14.87%

• 13.61%

• 14.28%

• 12.17%

You want to buy a condo 5 years from now, and you plan to save $3,000 per year, beginning immediately. You will make 5 deposits in an account that pays 6% interest. Under these assumptions, how much will you have 5 years from today?

• $16,110.34

• $17,925.96

• $17,513.68

• $15,976.84

• $18,349.15

Your father is about to retire, and he wants to buy an annuity that will provide him with $50,000 of income per year for 20 years, beginning a year from today. The going rate on such annuities is 6%. How much would it cost him to buy such an annuity today?

• $488,349.15

• $416,110.34

• $517,513.68

• $615,976.84

• $573,496.06

Suppose you inherited $200,000 and invested it at 6% per year. How much could you withdraw at the end of each of the next 15 years?

• $24,764.40

• $23,431.83

• $20,592.55

• $17,843.15

• $15,119.76

Your father has $500,000 and wants to retire. He expects to live for another 20 years, and he also expects to earn 8% on his invested funds. How much could he withdraw at the beginning of each of the next 20 years and end up with zero in the account?

• $53,431.83

• $47,153.80

• $54,764.40

• $47,843.15

• $45,119.76

If you invest $50,000 at an annual interest rate of 5%, how much will you have after 10 years?

• $81,444.70

• $75,000.00

• $65,000.00

• $62,889.46

• $55,000.00

A company reported earnings of $3.00 per share in 2010 and $4.50 per share in 2015. What was the annual growth rate of the earnings per share over this 5-year period?

• 8.45%

• 9.00%

• 8.00%

• 7.50%

• 10.00%

If you want to accumulate $20,000 in 4 years by saving a fixed amount annually at an interest rate of 7%, how much do you need to save each year?

• $4,200.00

• $4,500.00

• $4,800.00

• $4,000.00

• $4,100.00