# Finance 325 Introduction to Financial Management Assignment 1 Spring 2014

June 6, 2016

Question
Finance 325

Introduction to Financial Management

Spring 2014

Assignment 1

Remember: you will be expected to show your all work. (3 points for each question)

1. What is the present value of \$1,000 to be received 8 years from now? The interest rates are 10%.

2. We bought a stock for \$45.85 four years ago and we can sell it for \$59.13 today. The stock does not pay dividends. What annual rate of return have we earned?

3. What is the accumulated sum if \$1,000 is deposited at the end of every year for 5 years into an account compounded annually at 5%?

4. Now, work the problem 3 assuming an annuity duerather than an ordinary annuity

5. You buy a house for \$250,000. You put \$50,000 down, and get a 30-year fixed 6.5 percent loan for the rest. How much is your monthly payment?

6. How long will it take to pay off a \$27,000 loan with a 14 percent APR which compounds monthly? The payment is \$450 per month