Problem
For each of the following assignment questions, you are required to submit a detailed response in about 300 words. Submitting just a brief paragraph will not merit a high grade.
i. Using the rules of time travel as it relates to cash flows, explain how the present value of money and future value of money can be fungible?
ii. In a similar manner to the previous question, explain how the present value of annuity and the future value of annuity are fungible.
iii. Time value of money comes from the power of compounding. Explain in detail how a lower interest rate loan requiring more frequent repayments may be more expensive than some loans charging higher interest rates but less frequent loan repayments?
iv. How will you analytically compare and evaluate the following: Bank of America's offer to double your savings in 9 years, Citibank's offer of tripling your savings in 16 years, and US Bank's offer of quadrupling your savings in 19 years. Which offer will you choose and why?