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 €5 000 in a savings account that pays 5% interest per year, compounded annually. How much is in the account after 4 years? Find the future value FV.

PV = €5 000i = 5%n = 4

FV = €

2.Easy

A foundation wants to pay a prize of €2 500 at the end of every year, forever. The fund earns 3% interest per year. How much must be invested today? Find PV.

A = €2 500i = 3%

PV = €

3.Medium

A property is expected to earn net rent of €5 000 next year. The rent is expected to grow by 1.5% per year forever. The required return is 5.5% per year. Find the value PV of the property today.

C₁ = €5 000g = 1.5%r = 5.5%

PV = €

4.Medium

A credit card charges a nominal interest rate of 16% per year, compounded daily. Find the effective annual rate EAR in percent.

r = 16%m = 365

EAR = %

5.Hard

A loan of €30 000 is repaid with equal monthly payments over 3 years at 4.8% per year, compounded monthly. How much interest I is paid in total over the life of the loan?

P = €30 0004.8% / 12N = 36

I = €

6.Hard

A loan of €15 000 is repaid with equal monthly payments over 4 years at 2.4% per year, compounded monthly. How much interest I is paid in total over the life of the loan?

P = €15 0002.4% / 12N = 48

I = €

Answer key

1. FV = 6078 €
2. PV = 83333 €
3. PV = 125000 €
4. EAR = 17.35 %
5. I = 2272 €
6. I = 746.5 €

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