Reference no: EM132845800

Questions -

Q1. You expect to receive P1,000 at the end of each of the next 3 years. You will deposit these payments into an account which pays 10%, compounded semiannually. What is the future value of these payments, that is, the value at the end of the third year?

a. P3,318.01

b. P3,993.00

c. P7,986.00

d. P665.50

Q2. You plan to invest an amount of money in a certificate of deposit (CD) at your bank. The stated interest rate applied to the CD is 12%, compounded monthly. How much must you invest if you want the balance in the CD account to be P8,500 in 2½ years?

a. P11,302.14

b. P6,306.34

c. P11,941.89

d. P143,302.66

Q3. Justine is thinking about purchasing an investment from RCBC Capital. If she buys the investment, Justine will receive P1,000 every three months for two years. The first P1,000 payment will be made as soon as she purchases the investment. If Justine's required rate of return is 16%, how much should she be willing to pay for this investment?

a. P1,368.57

b. P10,764.80

c. P7,002.05

d. P1,345.60

Q4. If you need P350,000 for a down payment on a house in 3 years, how much money must you invest today at 8% interest, compounded quarterly, to achieve your goal?

a. P277,841.28

b. P275,972.61

c. P128,694.27

d. P44,388.46

Q5. Your firm rents office space for P250,000 per year, due at the BEGINNING of each year. If your firm's hurdle rate is 10%, what is the present value of five years' worth of rent?

a. P1,042,466.36

b. P402,627.50

c. P170,753.36

d. P155,230.33

Q6. You expect to receive P1,000 at the END of each of the next 3 years. You will deposit these payments into an account which pays 10 percent, compounded semiannually. What is the future value of these payments, that is, the value at the end of the third year?

a. P1,157.63

b. P1,340.10

c. P1,331.00

d. P3,318.01