β’ Exercise 1
Robert loans $10,000 immediately, $5,000 in 3 years and $1,000
in 4 years to George. George will repay the loan in 6
years.
a) What will be the amount ππ of this repayment if the interest
rate on this loan is 6% capitalized on a monthly basis?
b) What will be the present value V0 of this amount?
β’ Exercise 2
Christophe makes 2 deposits in an account paying an effective
annual rate of interest of r = 8%. P dollars today and 1.5 x P
dollars in 2 years. In 5 years, the amount accumulated in this
account is (P + 3,000). Determine P.
β’ Exercise 3
How much must Liam deposit in a 6% savings account if he wants
it to amount to 120$ after two years?
β’ Exercise 1 Robert loans $10,000 immediately, $5,000 in 3 years and $1,000 in 4 years to George. George will repay the
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β’ Exercise 1 Robert loans $10,000 immediately, $5,000 in 3 years and $1,000 in 4 years to George. George will repay the
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