Time value of money worksheet with answers

Free printable Time value of money worksheet: 6 problems from easy to exam level, with an answer key. Print it or save it as a PDF.

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Name: ____________________ Date: ____________

1.Easy

A foundation wants to pay a prize of €2 500 at the end of every year, forever. The fund earns 4% interest per year. How much must be invested today? Find PV.

A = €2 500i = 4%

PV = €

2.Easy

A foundation wants to pay a prize of €12 000 at the end of every year, forever. The fund earns 5% interest per year. How much must be invested today? Find PV.

A = €12 000i = 5%

PV = €

3.Medium

You invest €2 000 at a nominal rate of 6% per year, compounded quarterly. Find the value FV of the investment after 2 years.

PV = €2 0006% / 4n = 2

FV = €

4.Medium

You invest €1 000 at a nominal rate of 3.6% per year, compounded monthly. Find the value FV of the investment after 8 years.

PV = €1 0003.6% / 12n = 8

FV = €

5.Hard

You borrow €25 000 at 4.8% per year, compounded monthly, and repay €750 at the end of every month. How many months does it take until the loan is repaid (the last payment may be smaller)? Give the number of payments N.

P = €25 000A = €7504.8% / 12

N = payments

6.Hard

A mortgage of €300 000 is repaid with equal monthly payments over 20 years at 2.4% per year, compounded monthly. How much is still owed just after the payment at the end of year 14? Find the outstanding balance B.

P = €300 0002.4% / 12N = 240k = 168

B = €

Answer key

1. PV = 62500 €
2. PV = 240000 €
3. FV = 2253 €
4. FV = 1333 €
5. N = 36 payments
6. B = 105524 €

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