Consider a future value of $2,000, 7 years in the future. Assume that the nominal interest rate is 6.00%. If you are calculating the present value of this cash flow under semiannual (twice per year) compounding, you would enter 1/Y into your financial calculator. Entering in the values you just calculated for N and I/Y, along with a PMT-0 and a FV-$2,000, into a financial calculator yields a present value of with semiannual compounding. approximately $ If you are calculating the present value of this cash flow under quarterly (four times per year) compounding, you would enter for 1/Y into your financial calculator. for N and Suppose now that the cash flow of $2,000 only 1 year in the future. Entering in the values you just calculated for N and I/Y, along with a PMT-0 and a FV-$2,000, into a financial calculator yields a present value of with quarterly compounding. approximately $ If you are calculating the present value of this cash flow under quarterly (12 times per year) compounding, you would enter for 1/Y into your financial calculator. for N and for N and Entering in the values you just calculated for N and I/Y, along with a PMT-0 and a FV-$2,000, into a financial calculator yields a present value of with monthly compounding. approximately $ for
Consider a future value of $2,000, 7 years in the future. Assume that the nominal interest rate is 6.00%. If you are calculating the present value of this cash flow under semiannual (twice per year) compounding, you would enter 1/Y into your financial calculator. Entering in the values you just calculated for N and I/Y, along with a PMT-0 and a FV-$2,000, into a financial calculator yields a present value of with semiannual compounding. approximately $ If you are calculating the present value of this cash flow under quarterly (four times per year) compounding, you would enter for 1/Y into your financial calculator. for N and Suppose now that the cash flow of $2,000 only 1 year in the future. Entering in the values you just calculated for N and I/Y, along with a PMT-0 and a FV-$2,000, into a financial calculator yields a present value of with quarterly compounding. approximately $ If you are calculating the present value of this cash flow under quarterly (12 times per year) compounding, you would enter for 1/Y into your financial calculator. for N and for N and Entering in the values you just calculated for N and I/Y, along with a PMT-0 and a FV-$2,000, into a financial calculator yields a present value of with monthly compounding. approximately $ for
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