[meteor_slideshow slideshow=”arp1″]
To make optimal decisions, you must understand the relationship between a dollar today [present value] and a dollar in the future [future value].
Future value is the amount to which an investment will grow after earning interest. Interest can be of two types: i) simple interest, and ii) compound interest.
In a word document, upload your answers to the following questions below. Very importantly – show all your work. If your final answer is wrong, you can still receive partial credit if you show all of your steps and demonstrate a good understanding of the time value of money.
To complete Module 2 Case Assignment, please read the information in the background material, look for more information, and then write a 4 to 5 pages (excluding title page and references) report for your professor by responding to the following questions/tasks:
1) How would you define time value of money in your own words? Please provide a brief definition of time value of money in your own words.
2) To what extent is it important for financial managers to understand the concept of time value of money? Why? Please explain your reasoning in two to three paragraphs.
If you do not know how to use calculator, please use the tables to answer question 3, 4, 5, and 6.
Brealey, R.A., Myers, S.C., & Allen, F. (2005). Principles of corporate finance, 8th Edition. The McGraw−Hill. Retrieved May, 2012, fromhttp://jcooney.ba.ttu.edu/fin3322/Brealey%20Files/Appendix%20A%20-%20Present%20Value%20Tables.pdf
3) Calculate the future value of the followings:
a. $190,537.19 if invested for six years at a 8% interest rate
b. $231,891.22 if invested for four years at a 9% interest rate
c. $310,891.12 if invested for nine years at an 5% interest rate
d. $420,520.22 if invested for fifteen years with a 1% interest rate
Please use Table 2 [http://jcooney.ba.ttu.edu/fin3322/Brealey%20Files/Appendix%20A%20-%20Present%20Value%20Tables.pdf]
4) Calculate the present value of the followings:
a. $552,126.17 to be received four years from now with a 3% interest rate
b. $125,003.21 to be received three years from now with an 8% interest rate
c. $621,567.35 to received nine years from now with a 14% interest rate
d. $93,000.05 to be received eleven years from now with a 2% interest rate
Please use Table 1 [http://jcooney.ba.ttu.edu/fin3322/Brealey%20Files/Appendix%20A%20-%20Present%20Value%20Tables.pdf]
5) Suppose you are to receive a stream of annual payments (also called an “annuity”) of $225,891.12 every year for five years starting at the end of this year. The interest rate is 7%. What is the present value of these five payments?
Please use Table 3 [http://jcooney.ba.ttu.edu/fin3322/Brealey%20Files/Appendix%20A%20-%20Present%20Value%20Tables.pdf]
6) Suppose you are to receive a payment of $337,891.24 at the end of each year for seven years. You are depositing these payments in a bank account that pays 6% interest. Given these seven payments and this interest rate, how much will be in your bank account in seven years?
If you do not know how to use calculator, please use Table [http://www.principlesofaccounting.com/ART/fv.pv.tables/fvofordinaryannuity.htm]
7) What do you perceive you have learnt in Module 2 Case Assignment? Which of the following learning objectives do you feel you have mastered?
☼Make basic calculations concerning present and future value
☼Understand and discuss the concepts of present and future value
Please provide your evaluation of the Module 2 Case Assignment in brief.
NOTE: Please note that your report/assignment will not be accepted without proper citations and references. You must use the sources from the background material together with the sources you find your own. It is also REQUIRED that you answer all the questions related to learning outcomes.
Case Assignment Expectations: In Module 1 Case Assignment, you are expected to:
►Describe the purpose of the report and conclusion. An introduction and conclusion are important because many busy individuals in the business environment may only read the first and the last paragraph. If those paragraphs are not interesting, they never read the body of the paper.
►Answer the case assignment question clearly and provide necessary details. Also please review Tips for Good Writing [https://cdad.trident.edu/CourseHomeModule.aspx?course=56&term=92&module=3&page=custom1] and a guideline [http://www.trident.edu/Media/Default/pdf/Well-Written-Paper.pdf] to write a well-structured paper.
►Provide a quality argument; that is, no poor sentence structure, no spelling and grammar mistakes or run-on sentences.
►Provide citations to support your argument and references on a separate page (All the sources that you listed in the references section must be cited in the paper). Please use APA format to provide citations and references [http://owl.english.purdue.edu/owl/resource/560/01/].
►Type and double space the paper.
●The following criteria will also be used to assess your paper:
>Precision: Does the paper address the question(s) or task(s)?
>Breadth: Is the full breadth of the subject, i.e., all the keys to the assignment, addressed?
>Depth: Does the paper/report address all elements of the topic in sufficient depth? Does it include and apply the background readings and other background resources? Are they included as references?
>Critical thinking: Are the concepts of this module applied accurately, logically, and relevantly?
>Organization: Is the paper organized in a coherent and systematic manner? Are headings included in all papers greater than 2 pages?
>Clarity: Is the writing clear and the concepts articulated properly? Are paraphrasing and synthesis of concepts the primary means of response to the questions, or are thoughts conveyed through excessive use of quotations?
Finally, in the grading of your assignment, you will be assessed on the following items:
1) For the essay portion of this assignment, you should provide a direct answer to the assignment question and support your answer with solid references.
2) For the computational portions of this assignment, you should show your work and demonstrate that you understand the steps involved in your computations. Your final grade will depend not only on your final answer but also how well you illustrate the steps you took to reach your final answer
[meteor_slideshow slideshow=”arp2″]
A-Research-Paper.com is committed to deliver a custom paper/essay which is 100% original and deliver it within the deadline. Place your custom order with us and experience the different; You are guaranteed; value for your money and a premium paper which meets your expectations, 24/7 customer support and communication with your writer. Order Now
Use the order calculator below and get started! Contact our live support team for any assistance or inquiry.
[order_calculator]