# I need help finding the answers to the questions attached, the class is the time value money

How do i compute the PRESENT VALUE of a$100 cash flow for the following combinations of discount rates and times?

a. r=8 percent t= 10 years

b. r=8 percent t= 20 years

c. r=4 percent t=10 years

d. r=4 percent t=20 years

And how do I compute the FUTURE VALUE for a $100 cash flow for the same combination of rates and times as in the above problem?

I am not familiar with all of the abbreviations (for example the r means rate) if there are more abbreviations can you help me with the meaning?

Also how do I find the Interest rate implied by the following combinations of PRESENT and FUTURE VALUE?

PRESENT VALUE YEARS FUTURE VALUE

$400 11 $684

$183 4 $249

$300 7 $300

And how do I find the NUMBER OF PERIODS, how long will it take for $400 to grow to $1,000 at the interest rate specified?

a. 4 percent

b. 8 percent

c. 16 percent

Your help is GREATLY appreciated Thank you !!!

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#### Solution Preview

How do i compute the PRESENT VALUE of a$100 cash flow for the following combinations of discount rates and times?

a. r=8 percent t= 10 years

b. r=8 percent t= 20 years

c. r=4 percent t=10 years

d. r=4 percent t=20 years

The formula is

PRESENT VALUE = FUTURE VALUE / (1+r)^t

Where "^" means "to the power of"

Then

a. PV = 100 / (1+8%)^10 = $46.32

b. PV = 100 / (1+8%)^20 = $21.45

c. PV = 100 / (1+4%)^10 = ...