# Math for Financial Analysis Flashcards

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Present Value = *P* * ((1 - (1 + *i* )*-n* ) / *i*)

*P*: fixed payment amount; *i*: interest rate; *n*: number of payments

Future Value = *PMT* * ((( 1 + *i* )*n* - 1 ) / *i* )

*PMT*: monthly payment; *i*: interest rate; *n*: number of times interest is paid by bank

Future Value = PV * (1 + *i* )*n*

PV = $1,200*i* = 0.105/12

*n* = 25 years * 12 times a year = 300

$1,200 * (1 + 0.105/12)300 = $16,377.42

Future Value = PV * (1 + *i* )*n*

PV = $25,000*i* = 0.025 / 4

*n* = 10 years * 4 times a year = 40

$25,000 * (1 + 0.025 / 4)40 = $32,075.67

Future Value = PV * (1 + *i* )*n*

PV = $50,000*i* = 0.05

*n* = 4 years

$50,000 * (1 + 0.05)4 = $60,775.31

Present Value = FV / (1 + *i* )*n*

FV = $45,000*i* = 0.025 / 4*n* = 5 years * 4 times per year = 20

$45,000 / (1 + 0.025 / 4)20 = $39,727.81

Present Value = FV / (1 + *i* )*n*

FV = $100,000*i* = 0.105*n* = 7 years

$100,000 / (1 + 0.105)7 = $49,712.32

Present Value = FV / (1 + *i* )*n*

FV = $50,000*i* = 0.03*n* = 5 years

$50,000 / (1 + 0.03)5 = $43,130.44

Future value = *PV* * (1 + *i* )*n*

*PV*: present value; *i*: interest rate; *n*: number of time periods

Present value = *FV* / (1 + *i* )*n*

*FV*: future value; *i*: interest rate; *n*: number of time periods

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## Flashcard Content Overview

Do you know the difference between a stock and a bond? Can you calculate the amount of money each is worth? If you are trying to save money for a large purchase in the future, do you know how much money to put in an account that pays interest?

All of these questions can be answered with the help of the following flashcard set. Use these flashcards to learn important terms and calculations for working with investments and annuities.

Present value = *FV* / (1 + *i* )*n*

*FV*: future value; *i*: interest rate; *n*: number of time periods

Future value = *PV* * (1 + *i* )*n*

*PV*: present value; *i*: interest rate; *n*: number of time periods

Present Value = FV / (1 + *i* )*n*

FV = $50,000*i* = 0.03*n* = 5 years

$50,000 / (1 + 0.03)5 = $43,130.44

Present Value = FV / (1 + *i* )*n*

FV = $100,000*i* = 0.105*n* = 7 years

$100,000 / (1 + 0.105)7 = $49,712.32

Present Value = FV / (1 + *i* )*n*

FV = $45,000*i* = 0.025 / 4*n* = 5 years * 4 times per year = 20

$45,000 / (1 + 0.025 / 4)20 = $39,727.81

Future Value = PV * (1 + *i* )*n*

PV = $50,000*i* = 0.05

*n* = 4 years

$50,000 * (1 + 0.05)4 = $60,775.31

Future Value = PV * (1 + *i* )*n*

PV = $25,000*i* = 0.025 / 4

*n* = 10 years * 4 times a year = 40

$25,000 * (1 + 0.025 / 4)40 = $32,075.67

Future Value = PV * (1 + *i* )*n*

PV = $1,200*i* = 0.105/12

*n* = 25 years * 12 times a year = 300

$1,200 * (1 + 0.105/12)300 = $16,377.42

Future Value = *PMT* * ((( 1 + *i* )*n* - 1 ) / *i* )

*PMT*: monthly payment; *i*: interest rate; *n*: number of times interest is paid by bank

Present Value = *P* * ((1 - (1 + *i* )*-n* ) / *i*)

*P*: fixed payment amount; *i*: interest rate; *n*: number of payments

A partial ownership in a company that can be purchased by members of the public

Includes voting rights

A partial ownership in a company that can be purchased by members of the public

Does not include voting rights but does give priority access to dividend payouts

Company earnings that are paid to stockholders, starting with those that own preferred stock

Paid as a dollar amount per stock owned

Yield = (interest * par value)/price paid for bond

yield: actual interest earned; par value: the face value of the bond

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Business 110: Business Math10 chapters | 73 lessons | 5 flashcard sets