Time Value of Money (FM)

Happy Harry has just bought a scratch loterry ticket and won 10,000. He wants to finance the future study of his newly born daughter and invests this money in a fund with a maturity of 18 years offering a promising yearly return of 6%. What is the amount available on the 18th birthday of his daughter?

28,543

Rudy will retire in 20 years. This year he wants to fund an amount of 15,000 to become available in 20 years. How much will he deposit turn into if his earnings are 7% annually on his investment?

58,045

The National Savings Fund promises a yearly 9% return if you deposit 8,000 each year for 15 consecutive years. What amount will be accumulated after those 15 years if

a) Deposit is made at the beginning of each year

b) Depoist is made at the end of each year

a) 2,56,027

b) 2,34,887

Willy has just bought a house. She estimates that the roof will have to be renewed at a cost of 25,000 after 20 years. To cover these costs, she intends to save an equal amount of money at the end of each year, earning 6% annual interest rate. How much is  a yearly annuity? 

680

Suppose you inherited 20,00,000 and invested it at 6% per year. How much could you withdraw at the end of each of the next 15 years?

2,05,926

Suppose you have decided to put 2,400 at the beginning of every year in a savings account that credits interest at the annual rate of 6% per annum. find the amount in this account after 30 years.

2,01,124

What is the balance in an account at the end of 10 years if 2,500 is deposited today and the account earns 4% interest, compounded 

a) annually

b) quarterly

a) 3,700

b) 3,722

How much would I have to deposit in an account today that pays 12% interest, compounded quarterly, so that I have a balance of 20,000 in the account at the end of 10 years?

6,131

Suppose you want to have 50,00,000 saved by the time you reach 30 and suppose that you are 20 now. If you can earn 5% on your funds, how much would you have to invest today to reach your goal?

30,69,566

If you are scheduled to retire this year end and wish to have an annual pension fund receipt of 80,000 annually from the beginning of the next year for next 20 years, how much should you be investing in a Pension Fund this year end if you expect to earn a 12% return on your investment?

6,69,262

You plan to invest 2,000 in an individual retirement plan today that pays a stated annual interest rate of 8%, which is expected to apply to all future years. How much will you have in the account at the end of 10 years if interest is compounded as follows:

a) Annually

b) Semi-annually

c) Quarterly

a) 4,318

b) 4,382

c) 4,416

Mr. Das wanted to buy a TV from Vijay sales which shows a price of 85,000. If he wishes to pay it in 4 equal installments each year, what will be the installment amount charged if the store has rate of return of 11.5%?

27,691

PV = 6,40,00

n = 5

r = 7.6%

Find Future Value Annually, Semi-Annually and Quarterly

a) 9,23,082

b) 9,29,294

c) 9,32,531

Ms. Sheetal has an annual savings of 3,45,000 and plans to start a new startup after 7 years. If she invests her savings in an investment fund promising her an average return of 11.25% per annum what will be the fund available for her for her startup if she invests

a) end of each year

b) start of each year

a) 34,21,284

b) 37,83,929

Mr. Shah wants to invest in a life insurance policy which assures him a maturity amount of 16,00,000 after 12 years. If the insurance company is offering a rate of 7.4% pa what is the premium burden on Mr. Shah each year?

87,359

Mr Singh is expecting an expense of 18,00,000 for his son’s wedding after 9 years. He has been investing his funds giving him on average return of 11.6%. How much should he invest today to meet his expenses?

6,70,339

Mr Jatin is promised to be paid 3,50,000 each year under contract of 5 years for a photoshoot. If Mr.. Hatin decides to take a lumsum amount of 13,00,000, suggest what should he do if his rate of return in 12.9% pa

12,34,040

Mr. X wants to generate 2,40,000 each year for 6 years through an investment plan assuring a return of 9.6% pa. What should be his investment amount today?

10,57,630

Mr. Shah wants to make a foreign trip after 12 years and has 7,20,000 investable fund expecting a return of 12.65% pa. What can be his budget for his trip?

30,06,815

Satish wants to buy a camera for 3,50,000. He plans to fund the same by selling investments that give a return at 12.5% pa. If the camera life is 5 years how much should he earn to recover the cost of the camera?

98,298

Mr. Jain has signed an agreement with us for an ad campaign conducted for him for the next 6 years at 2,20,000 per year. If he wishes to make a lumsum payment for the agreement, what should be your billing amount for Mr. Jain if your professional income generates a return of 14.3% pa?

8,48,525

Raunak wants to buy a drone which is priced at 4,20,000 but can only acquire it after 4 years due to lack of funds. If national inflation rate is assumed to stay at 8.5% each year, how much will he spend to buy a drone?

5,82,,061

Mr. Anand plans to buy a podcast setup for which he plans to keep aside 1,80,000 each year which can further be invested for rate of 13.5%. If he is 20 years right now and wants to own his own podcast studio by 24, what will be the market value of the studio when he owns it?

8,79,365

How much a person should save annually to accumulate Rs.1,00,000 for his daughter's marriage by the end of 10 years, at the interest rate of 8%.

6,903

A person plans to contribute Rs. 2,000 every year to a retirement account which is paying 8% interest. If the person retires in 30 years, what is the amount he would receive on his retirement?

2,726,565