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
years0123…9PV = ?€10 000€10 000€10 000…

A foundation wants to pay a prize of €10 000 at the end of every year, forever. The fund earns 5% interest per year. How much must be invested today? Find PV.

A = €10 000i = 5%
PV = €
2.Easy
years0123…9PV = ?€500€500€500…

A foundation wants to pay a prize of €500 at the end of every year, forever. The fund earns 2.5% interest per year. How much must be invested today? Find PV.

A = €500i = 2.5%
PV = €
3.Medium
periods0123411 + EAR = ?19.5% / 4

A credit card charges a nominal interest rate of 19.5% per year, compounded quarterly. Find the effective annual rate EAR in percent.

r = 19.5%m = 4
EAR = %
4.Medium
years012345€1 000FV = ?

You invest €1 000 at 3% per year with continuous compounding. Find the value FV after 5 years.

PV = €1 000r = 3%t = 5
FV = €
5.Hard
months0123…N = ?€12 000€175€175€175€1753% / 12

You borrow €12 000 at 3% per year, compounded monthly, and repay €175 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 = €12 000A = €1753% / 12
N = payments
6.Hard
months0123…300€200 000A?AAA

A loan of €200 000 is repaid with equal monthly payments over 25 years. The interest rate is 2.4% per year, compounded monthly. Find the monthly payment A.

P = €200 0002.4% / 12N = 300
A = €

Answer key

  1. 1. PV = 200000 €
  2. 2. PV = 20000 €
  3. 3. EAR = 20.97 %
  4. 4. FV = 1162 €
  5. 5. N = 76 payments
  6. 6. A = 887.2 €

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