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Basic Question 3 of 3
The following end-of-month payments of $400, $700, and $300, respectively, are due. Given a stated annual interest rate of 3.60 percent, the minimum amount of money needed in an account today to satisfy these future payments is closest to ______.
B. $1,327
C. $1,368
A. $1,391
B. $1,327
C. $1,368
User Contributed Comments 9
| User | Comment |
|---|---|
| tomalot | Method one gives a NPV of 1,322.709. Method 2 seems correct. Confused! |
| lordcomas | Does anyone has an idea where to find a tutorial for using cashflows with the TI BAII plus? |
| bwhitele | Why is the solution using i = 0.3 and not 0.36? |
| myron | because it's the monthly interest rate @bwhitele |
| ashish100 | Yeah, issue as lordcomas. How do i add the "I" on BAII plus? Thanks in advance. |
| IvanRios | 3.6%/12months = .3/per month. That is why I = 0.3 |
| Sagarsan88 | I get an npv of 1396.11...i used the CF method on calc....any clue why the nos don't match...thank you |
| nadiahalus | For BA II: 2nd.CF. CF0=0. ARROW DOWN. C01=400.ENTER.F01=1. C02=700.ENTER.F02=1. C03=300.ENTER.F03=1. PRESS NVP.I=0.3.ENTER.ARROW DOWN.NVP=1391.94 CORRECT ANSWER A. |
| Bishlawy | Hello! I am not able to download notes as PDF, any ideas? |
I passed! I did not get a chance to tell you before the exam - but your site was excellent. I will definitely take it next year for Level II.
Tamara Schultz
Learning Outcome Statements
calculate and interpret the future value (FV) and present value (PV) of a single sum of money, an ordinary annuity, an annuity due, a perpetuity (PV only), and a series of unequal cash flows;
CFA® 2024 Level I Curriculum, Volume 1, Module 1.