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HCA270 / HCA 270 / CheckPoint: Present and Future Value

# HCA270 / HCA 270 / CheckPoint: Present and Future Value

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CheckPoint: Present and Future Value
 Resource: Ch. 5 of the text
 Due Date: Day 5 [Individual forum]
 Calculate the future value of the following:
o \$5,000 compounded annually at 6% for 5 years
o \$5,000 compounded semiannually at 6% for 5 years
o \$5,000 compounded quarterly at 6% for 5 years
o \$5,000 compounded annually at 6% for 6 years
 Answer the following: What conclusions can be drawn about the frequency of compounding interest? What conclusions can be drawn about the length of time an amount is compounding?
 Calculate the present value of the following:
o \$7,000 in 5 years at an annual discount rate of 6%
o \$7,000 in 5 years at a semiannual discount rate of 6%
o \$7,000 in 5 years at a quarterly discount rate of 6%
o \$7,000 in 6 years at an annual discount rate of 6%
 Answer the following: What conclusions can be drawn about the frequency of the discounting interval? What conclusions can be drawn about the length of time until the receipt of that value?
 Answer the following: Assume you have a choice between two annuity contracts. Contract A pays \$5,000 per year for 5 years starting one year from today. Contract B pays \$5,000 per year
HCA 270 Financial Matters for Health Care Professionals
Course Syllabus Page 11
for 5 years starting today. The discount rate for each is 6%. Which annuity contract would you choose for your retirement? Why?
CheckPoint: Present and Future Value
 Resource: Ch. 5 of the text
 Due Date: Day 5 [Individual forum]
 Calculate the future value of the following:
o \$5,000 compounded annually at 6% for 5 years
o \$5,000 compounded semiannually at 6% for 5 years
o \$5,000 compounded quarterly at 6% for 5 years
o \$5,000 compounded annually at 6% for 6 years
 Answer the following: What conclusions can be drawn about the frequency of compounding interest? What conclusions can be drawn about the length of time an amount is compounding?
 Calculate the present value of the following:
o \$7,000 in 5 years at an annual discount rate of 6%
o \$7,000 in 5 years at a semiannual discount rate of 6%
o \$7,000 in 5 years at a quarterly discount rate of 6%
o \$7,000 in 6 years at an annual discount rate of 6%
 Answer the following: What conclusions can be drawn about the frequency of the discounting interval? What conclusions can be drawn about the length of time until the receipt of that value?
 Answer the following: Assume you have a choice between two annuity contracts. Contract A pays \$5,000 per year for 5 years starting one year from today. Contract B pays \$5,000 per year
HCA 270 Financial Matters for Health Care Professionals
Course Syllabus Page 11
for 5 years starting today. The discount rate for each is 6%. Which annuity contract would you choose for your retirement? Why?

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