Single Cash Flow PV = FV (1+r)n Annuity : FV = PV(1+r) n (1+r)" − 1 (1+r)n−1 * FVA = PMT FVAD = PMT (1+r) r PVA = PMT r 1 1 1 (1+r)n PVAD = PMT (1+r)*(1+r) r r r(1+r)n PMT = PV (1+r)n-1 Perpetuities PVP = PMT r

Corporate Fin Focused Approach
5th Edition
ISBN:9781285660516
Author:EHRHARDT
Publisher:EHRHARDT
Chapter4: Time Value Of Money
Section4.12: Uneven, Or Irregular, Cash Flows
Problem 1ST
Question

Tina owes $12,000 on her automobile loan, which has an interest rate equal to 4.8 percent compounded monthly. If Tina pays $526 at the end of each month, how long will it take her to repay the loan? (LO 4-4)

 

Number 23 will be challenging. Do not forget to use a timeline

Single Cash Flow
PV =
FV
(1+r)n
Annuity
:
FV = PV(1+r) n
(1+r)" − 1
(1+r)n−1 *
FVA = PMT
FVAD = PMT
(1+r)
r
PVA = PMT
r
1
1
1
(1+r)n
PVAD = PMT
(1+r)*(1+r)
r
r
r(1+r)n
PMT = PV
(1+r)n-1
Perpetuities
PVP =
PMT
r
Transcribed Image Text:Single Cash Flow PV = FV (1+r)n Annuity : FV = PV(1+r) n (1+r)" − 1 (1+r)n−1 * FVA = PMT FVAD = PMT (1+r) r PVA = PMT r 1 1 1 (1+r)n PVAD = PMT (1+r)*(1+r) r r r(1+r)n PMT = PV (1+r)n-1 Perpetuities PVP = PMT r
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