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FIN 370 Cash Flow Problem Sets (4-5,4-7,4-8,4-11,4-13)
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4-5 Multiyear Future Value How much would be in your savings
account in 11 years after depositing $150 today if the bank pays 8
percent per year? (LG4-3)
4-7 Compounding with Different Interest Rates A deposit of $350
earns the following interest rates:
a. 8 percent in the first year.
b. 6 percent in the second year.
c. 5.5 percent in the third year.
What would be the third year future value?
4-8 Compounding with Different Interest Rates A deposit of $750
earns interest rates of 9 percent in the first year and 12 percent in
the second year. What would be the second year future value? (LG43)
4-11 Present Value What is the present value of a $1,500 payment
made in nine years when the discount rate is 8 percent? (LG4-4)
4-13 Present Value with Different Discount Rates Compute the
present value of $1,000 paid in three years using the following
discount rates: 6 percent in the first year, 7 percent in the second
year, and 8 percent in the third year. (LG4-4)