- CFA Exams
- CFA Level I Exam
- Topic 1. Quantitative Methods
- Learning Module 2. Time Value of Money in Finance
- Subject 2. Fixed Income Instruments and the Time Value of Money
CFA Practice Question
At the end of 15 years, you wish to have accumulated $500,000. You plan to accumulate this money by making annual deposits into a money market account paying 8% per year. All deposits will be made at the beginning of each year. How much must be deposited each year?
B. $18,414.77
C. $15,787.70
A. $17,050.72
B. $18,414.77
C. $15,787.70
Correct Answer: A
BGN, FV = $500,000; n = 15; i = 8%; CPT PMT = -$17,050.72
User Contributed Comments 6
| User | Comment |
|---|---|
| wundac | Correct answer is B): 500000/[((1+0.08)^15)-1]/0.08 = 18414.77 |
| magicchip | Wundac, A is correct. Dont forget payments are at the beginning of the year. |
| Ratego | Set your calc to bgn.And do remember to set it back to end when through! |
| rihilule | Agree with magicchip and Ratego! |
| johntan1979 | wundac... remember this name guys. He will be the top scorer this year. |
| tichas | Correct answer is A. BA11 gives u 17050.71525 |