Formula for pv of future balloon payment

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Reference no: EM1328249

When the Federal Reserve notifies banks that they must hold fifteen cents for every dollar that is deposited, it is controlling the money supply by using which of the following tools?

A. discount rate
B. open market operations
C. reserve requirements ratio
D. risk
E. unable to tell with the information provided

You would use the formula for the ______ if you wanted to calculate the present value of a future balloon payment on a house. This way, you know how much to deposit today to have the money available when the balloon payment is due.

A. present value of a future lump sum
B. future value of a lump sum
C. future value of an ordinary annuity
D. future value of an annuity due

Reference no: EM1328249

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