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Present Value

time value of money

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Shalini chasta
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10 views3 pages

Present Value

time value of money

Uploaded by

Shalini chasta
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
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PRESENT VALUE

Question 1: You want ₹50,000 in 3 years to buy a new phone. If the interest
rate is 5% per year, how much should he invest today?
Question 2: Rahul wants to purchase a car in 5 years, which will cost him
₹8,00,000 at that time. If the bank offers him a 9% annual interest rate, how
much should he invest today to have enough money in 5 years?
QUESTION 3: Neha plans to invest in a fund that will give her ₹1,50,000 after 6
years. If the interest rate is 7% per annum, what is the present value of this
future amount?
Question 4: You want to withdraw ₹20,000 per year for the next 10 years from
an account that earns 5% annual interest. How much do you need to invest
today?
Question 5: A company plans to pay an employee ₹1,20,000 annually for the
next 7 years as part of a retirement package. If the company applies a discount
rate of 6% per annum, what is the present value of this annuity?
Question 6: Suppose you want to receive ₹10,000 at the beginning of each year
for 5 years, and the annual discount rate is 8%. What is the present value of
these payments?
Question 7: You are expecting to receive ₹15,000 at the end of each year for
the next 7 years. The annual discount rate is 6%. What is the present value of
these payments?
Question 8: A project will provide the following uneven cash flows: ₹10,000 at
the end of Year 1, ₹20,000 at the end of Year 3, and ₹30,000 at the end of Year
5. If the discount rate is 8%, what is the present value of these cash flows?
QUESTION 9: You will receive ₹20,000 annually for 4 years and a lump sum
payment of ₹50,000 at the end of Year 5. If the discount rate is 6%, what is the
present value of these future payments?
QUESTION 10: You are considering an investment that will return varying
amounts over the next 7 years: ₹12,000 in Year 1, ₹15,000 in Year 2, ₹18,000 in
Year 3, ₹22,000 in Year 4, ₹25,000 in Year 5, ₹28,000 in Year 6, and ₹30,000 in
Year 7. If the annual discount rate is 9%, what is the present value of these
future cash flows?
Future value
Question 1: You invest ₹10,000 in a savings account earning 8% interest per
year. What will the value of this investment be after 5 years?

Question 2: You plan to deposit ₹5,000 at the end of each year for the next 10
years into an account earning 7% interest annually. What will be the total
amount after 10 years?
Question 3: A invests an initial lump sum of ₹1,00,000 and adds ₹10,000 at the
end of each year for the next 5 years in an account that earns 6% annually.
What will be the future value of her investment at the end of 5 years?
Question 4: You decide to save for retirement by contributing ₹20,000 at the
end of the first year, and increasing the contribution by ₹5,000 each year for
the next 7 years (i.e., ₹25,000 in Year 2, ₹30,000 in Year 3, and so on). The
account earns 7% interest annually. What will be the future value of your
retirement savings at the end of 7 years?
Question 5: You plan to save ₹5,000 at the end of each quarter for the next 8
years in an account that offers a 6% annual interest rate, compounded
quarterly. What will be the future value of your savings at the end of 8 years?
Que 1. If you invest ₹5,000 per month for 3 years in an account with an annual
interest rate of 8%, compounded monthly, what will be the value of your
investment at the end of 3 years?
Que 2. Meena plans to save ₹5,000 at the end of the first year, with her annual
savings increasing by 5% every year. If the interest rate is 7% per annum, what
will be the future value of her savings after 6 years?
Que 3. A bond pays ₹15,000 semi-annually for 10 years, and the face value of
the bond is ₹3,00,000. If the market interest rate is 9% per annum, what is the
present value of the bond?

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