Time Value Of Money FiniteQuest

Time value of money

Quantitative Methods

1 / 10

You plan to save 200 CCY at the end of each month for the next 5 years in a savings account that offers a 4% annual interest rate. What will be the future value of your savings at the end of the 5 years?

11,200 CCY

12,200 CCY

13,200 CCY

14,200 CCY

2 / 10

An investment offers a 10% annual interest rate. If you invest 1,000 CCY today, how much will it be worth in 10 years?

1,000 CCY

2,000 CCY

1,259.71 CCY

3,000 CCY

3 / 10

If you want to accumulate 10,000 CCY in 5 years and the annual interest rate is 6%, how much should you invest today?

7,800 CCY

8,000 CCY

8,300 CCY

8,600 CCY

4 / 10

What is the formula for calculating the future value of an annuity?

FV = PMT * (1 + r)

FV = PMT / (1 + r)

FV = PMT * [(1 + r)^n – 1] / r

FV = PMT / r

5 / 10

Which of the following factors does NOT affect the time value of money calculations?

Inflation

Interest rates

Investment risk

Time horizon

6 / 10

An investment offers an annual return of 8%. What is the present value of 5,000 CCY to be received in 3 years?

4,500 CCY

4,600 CCY

4,200 CCY

5,500 CCY

7 / 10

Which time value of money formula is used to calculate the present value of a future cash flow?

PV = FV * (1 + r)

PV = FV / (1 + r)

PV = FV + r

8 / 10

If you invest 1,000 CCY at an annual interest rate of 5%, how much will you have after 5 years?

1,250 CCY

1,276.28 CCY

1,500 CCY

750 CCY

9 / 10

Which of the following equations represents the future value of a single sum invested today?

FV = PV / (1 + r)

FV = PV * (1 + r)

FV = PV – r

FV = PV + r

10 / 10

What is the time value of money (TVM)?

The idea that money is more valuable in the future than in the present.

The concept that money’s value remains constant over time.

The principle that money has no value.

The belief that money’s value decreases over time.

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