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 €5 000 at the end of every year, forever. The fund earns 6% interest per year. How much must be invested today? Find PV.

A = €5 000i = 6%

PV = €

2.Easy

An investment of €1 000 grows to €1 420 in 6 years with annual compounding. Find the annual interest rate i in percent.

PV = €1 000FV = €1 420n = 6

i = %

3.Medium

A property is expected to earn net rent of €5 000 next year. The rent is expected to grow by 4% per year forever. The required return is 6% per year. Find the value PV of the property today.

C₁ = €5 000g = 4%r = 6%

PV = €

4.Medium

A property is expected to earn net rent of €6 000 next year. The rent is expected to grow by 1% per year forever. The required return is 4% per year. Find the value PV of the property today.

C₁ = €6 000g = 1%r = 4%

PV = €

5.Hard

You borrow €15 000 at 2.4% 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 = €2252.4% / 12

N = payments

6.Hard

You deposit €1 000 at the start of every year for 20 years, the first deposit today. The account pays 7% per year. How much is in the account at the end of year 20? Find FV.

A = €1 000i = 7%n = 20

FV = €

Answer key

1. PV = 83333 €
2. i = 6.018 %
3. PV = 250000 €
4. PV = 200000 €
5. N = 72 payments
6. FV = 43865 €

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