HCS 219 Week 3 Time Value of Money Worksheet

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 HCS 219 Week 3 Time Value of Money Worksheet
 

Resource: Time Value of Money Worksheet

You decide it would be good to send Lauren some additional information regarding time value of money concepts.

Complete the Time Value of Money Worksheet.

Click the Assignment Files tab to submit your assignment.

Time Value of Money Worksheet

 

Part 1: Complete the following table by inserting your responses to the questions. Cite any sources you use. 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Define the time value of money.
 
Provide a real-world example for the time value of money.
 
Why is time such an important factor in financial matters?
 
How would you use the time value of money to your financial benefit?
 
 

 

Part 2: Complete the following tables by calculating the ratios.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Amount
Compounding period
Rate of interest
Present value
$100,000
Annual
6% for 10 years
 
$70,000
Annual
4% for 15 years
 
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Initial cost of investment
Periods of useful life
Estimated annual net cash inflow generated
Look-up table value
Rate of interest
$75,000
10
$10,190
 
 
$56,000
6
$12,115
 
 
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Purchase price of equipment
Period of useful life
Annual revenue generated per year
Operating costs associated with revenue
Depreciation expense per year
Payback period result
$550,000
10 years
$100,000
$32,000
$55,000
 
$350,000
10 years
$80,500
$36,000
$35,000
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