Business value of time!

1. Compute the present value of $5,900 paid in two years using the following discount rates: 8 percent in the first year and 7 percent in the second year(Do not round intermediate calculations and round your answer to 2 decimal places.)

2. A deposit of $710 earns interest rates of 7 percent in the first year and 10 percent in the second year.

What would be the second year future value? (Round your answer to 2 decimal places.)

3. Determine the interest rate earned on a $2,200 deposit when $2,500 is paid back in one year. (Round your answer to 2 decimal places.)

4. Approximately how many years are needed to double a $500 investment when interest rates are 11.25 percent per year? (Round your answer to 2 decimal places.)

5. Calculate the present value in two years using discount rates.

6. A loan is offered with monthly payments and a 10.75 percent APR. Whatβs the loanβs effective annual rate (EAR)? (Do not round intermediate calculations and round your final answer to 2 decimal places.)

7. What is the future value of a $580 annuity payment over six years if interest rates are 10 percent? (Do not round intermediate calculations and round your final answer to 2 decimal places.)

8. Compute the future value in year 8 of a $5,300 deposit in year 1 and another $4,800 deposit at the end of year 3 using an 10 percent interest rate. (Do not round intermediate calculations and round your final answer to 2 decimal places.)

9. If the future value of an ordinary, 8-year annuity is $7,300 and interest rates are 8.0 percent, what is the future value of the same annuity due? (Round your answer to 2 decimal places.)

10. Calculate the loanβs effective annual rate (EAR).

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