- CFA Exams
- CFA Exam: Level I 2021
- Study Session 2. Quantitative Methods (1)
- Reading 6. The Time Value of Money
- Subject 4. The Future Value and Present Value of a Series of Equal Cash Flows (Ordinary Annuities, Annuity Dues, and Perpetuities)

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**CFA Practice Question**

You are trying to accumulate $5,000 in a savings account at the end of 4 years. You plan to make yearly deposits of $1,061.63 at the end of each year. What interest rate must the savings account pay in order for you to accumulate $5,000?

B. 11%

C. 12%

A. 10%

B. 11%

C. 12%

Correct Answer: B

By calculator: PMT = -$1,061.63; n = 4; FV = $5,000.00; CPT i = 11%

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