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 €2 500 in a savings account that pays 5% interest per year, compounded annually. How much is in the account after 2 years? Find the future value FV.

PV = €2 500i = 5%n = 2

FV = €

2.Easy

You deposit €4 000 at 9% 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 €10 000?

PV = €4 000FV = €10 000i = 9%

n = years

3.Medium

A property is expected to earn net rent of €8 000 next year. The rent is expected to grow by 2% per year forever. The required return is 8% per year. Find the value PV of the property today.

C₁ = €8 000g = 2%r = 8%

PV = €

4.Medium

A credit card charges a nominal interest rate of 21% per year, compounded quarterly. Find the effective annual rate EAR in percent.

r = 21%m = 4

EAR = %

5.Hard

You borrow €15 000 at 4.8% per year, compounded monthly, and repay €225 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 = €15 000A = €2254.8% / 12

N = payments

6.Hard

You save €500 at the end of every month for 29 years. The account pays 3% per year, compounded monthly. How much have you saved at the end? Find FV.

A = €5003% / 12N = 348

FV = €

Answer key

1. FV = 2756 €
2. n = 11 years
3. PV = 133333 €
4. EAR = 22.71 %
5. N = 78 payments
6. FV = 276864 €

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