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

You deposit €500 in a savings account that pays 2.5% interest per year, compounded annually. How much is in the account after 5 years? Find the future value FV.

PV = €500i = 2.5%n = 5

FV = €

2.Easy

You deposit €2 000 at 4% interest per year, compounded annually (interest is added at the end of each year). After how many whole years n does the balance first reach at least €4 000?

PV = €2 000FV = €4 000i = 4%

n = years

3.Medium

A property is expected to earn net rent of €8 000 next year. The rent is expected to grow by 4% per year forever. The required return is 10% per year. Find the value PV of the property today.

C₁ = €8 000g = 4%r = 10%

PV = €

4.Medium

An annuity pays €1 500 at the end of each year for 4 years. The interest rate is 5% per year. Find the present value PV of the annuity.

A = €1 500i = 5%n = 4

PV = €

5.Hard

A mortgage of €250 000 is repaid with equal monthly payments over 25 years at 2.4% per year, compounded monthly. How much is still owed just after the payment at the end of year 18? Find the outstanding balance B.

P = €250 0002.4% / 12N = 300k = 216

B = €

6.Hard

You deposit €6 000 at the start of every year for 23 years, the first deposit today. The account pays 3% per year. How much is in the account at the end of year 23? Find FV.

A = €6 000i = 3%n = 23

FV = €

Answer key

1. FV = 565.7 €
2. n = 18 years
3. PV = 133333 €
4. PV = 5319 €
5. B = 85672 €
6. FV = 200559 €

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