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WorksheetsChapter 4: Time Value of Money Part 1
Total questions: 10
Worksheet time: 19mins
The "time value of money" means that
money paid out today less value than if the money is paid out in the future
money received today is worth more than the same amount of money received in the future
the more time a person has to save, the lower the return on the money
the longer money is held, the less likely it will be spent
Lisa wants to know what the value of her RM1,000 will be if she invests it for 3 years at a given rate. What is Lisa trying to find?
Present value
Future value
Effective annual rate (EAR)
Discount rate
Today, you deposit RM500 into Bank A saving account that pays 8% interest per year. How much will you have in five years?
RM738.73
RM734.66
RM834.66
RM850.66
What is the present value of RM10,000 to be received in year 10 at an interest rate of 10%?
RM4,855.43
RM5, 855.43
RM3,855.43
RM6, 855.43
You invest RM700 in an acoount that pays 8% interest, compounded annually. How much money do you have after six years? Round your answer to the nearest cent.
RM1,110.81
RM1, 111.81
RM1, 112.81
RM1,101.81
What is the total amount accumulated after 3 years if someone invests RM1000 today with a simple annual interest rate of 5 percent?
RM1,150
RM1,110
RM1,150
RM1,103
Cash received today is preferred to cash received in the future
True
False
Earning interest on interest is called
Extra interest
Inflation interest
Simple interest
Compound interest
