CM 2113 FINAL EXAM EXAM SCRIPT 2026
COMPREHENSIVE QUESTIONS WITH
DETAILED SOLUTIONS GRADED A+
⩥ The Time Value of money is based on the premise that money can
generate _______ over a period of time. Answer: Interest
⩥ Comparing a future cost of one alternative with the present worth cost
of a second alternative is valid and meaningful. Answer: False
⩥ The reason why the value of money increases with time is because of
the interest rate. Answer: True
⩥ Look up the following factor value in the given reference table.
(P/F, 5%, 6) Answer: 0.746
⩥ Look up the following factor value in the given reference table.
(P/A, 10%, 15) Answer: 7.606
⩥ Look up the following factor value in the given reference table.
(A/F, 2%, 8) Answer: 0.117
, ⩥ Look up the following factor value in the given reference table.
(F/P, 3%, 4) Answer: 1.126
⩥ Look up the following factor value in the given reference table.
(A/P, 4%, 2) Answer: 0.530
⩥ Look up the following factor value in the given reference table.
(F/A, 9%, 11) Answer: 17.560
⩥ A contractor is investing $5,000 per year in savings certificates at an
annual interest rate of 10% and plans to continue the investment
program for 5 years, what will the value of the contractor investment be
at the end of 5 years? Answer: 30,525
⩥ A contractor plans to purchase a pickup truck in 10 years, how much
should the contractor invest at 5% interest today to have the $30,000
needed to purchase the truck at the end of 10 years? Answer: 18,420
⩥ What the annual cost for a tractor is if a contractor is considering
purchasing a used tractor for $180,000 at 10% interest that she could use
for 10 years and then sell for an estimated salvage value of $10,000.
Annual maintenance and repair costs for the used tractor are estimated to
be $15,000 per year. Answer: 43,710
COMPREHENSIVE QUESTIONS WITH
DETAILED SOLUTIONS GRADED A+
⩥ The Time Value of money is based on the premise that money can
generate _______ over a period of time. Answer: Interest
⩥ Comparing a future cost of one alternative with the present worth cost
of a second alternative is valid and meaningful. Answer: False
⩥ The reason why the value of money increases with time is because of
the interest rate. Answer: True
⩥ Look up the following factor value in the given reference table.
(P/F, 5%, 6) Answer: 0.746
⩥ Look up the following factor value in the given reference table.
(P/A, 10%, 15) Answer: 7.606
⩥ Look up the following factor value in the given reference table.
(A/F, 2%, 8) Answer: 0.117
, ⩥ Look up the following factor value in the given reference table.
(F/P, 3%, 4) Answer: 1.126
⩥ Look up the following factor value in the given reference table.
(A/P, 4%, 2) Answer: 0.530
⩥ Look up the following factor value in the given reference table.
(F/A, 9%, 11) Answer: 17.560
⩥ A contractor is investing $5,000 per year in savings certificates at an
annual interest rate of 10% and plans to continue the investment
program for 5 years, what will the value of the contractor investment be
at the end of 5 years? Answer: 30,525
⩥ A contractor plans to purchase a pickup truck in 10 years, how much
should the contractor invest at 5% interest today to have the $30,000
needed to purchase the truck at the end of 10 years? Answer: 18,420
⩥ What the annual cost for a tractor is if a contractor is considering
purchasing a used tractor for $180,000 at 10% interest that she could use
for 10 years and then sell for an estimated salvage value of $10,000.
Annual maintenance and repair costs for the used tractor are estimated to
be $15,000 per year. Answer: 43,710
