MAC2602 FORMULA – SHEET.

QUESTION 1 - TIME VALUE OF MONEY (TVM) 1. SIMPLE INTERST: → I = simple interest, P = principal, R = interest rate and T = time 2. COMPOUND INTERST: → I = compound interest, P = principal and i = interest rate 3. FUTURE VALUE (SINGLE PAYMENT – 1 PERIOD): → FV = future value, PV = present value, i = interest rate 4. FUTURE VALUE (SINGLE PAYMENT – MULTIPLE PERIODS): → FV = future value, PV = present value, i = interest rate and n = Number of years/periods 5. FUTURE VALUE (ORDINARY ANNUITY): → I = Annuity amount or payment, i = Interest rate, n = Number of years or periods 6. FUTURE VALUE (ANNUITY DUE): 7. PRESENT VALUE (SINGLE PAYMENT): 8. PRESENT VALUE (ORDINARY ANNUITY): 9. PRESENT VALUE (PERPETUITY): 10. PRESENT VALUE (ANNUITY DUE): I = P x R x T I = P(1+i) FV = PV(1 + i) FV = PV(1 + i)n 11. PERIODIC RATE: 12. EFFECTIVE INTEREST RATE 13. NOMINAL RATE 14. INTERPOLATION 15. EXTRAPOLATION 16. PERIODIC PAYMENT (