Annual payment-what is difference in the present value

Assignment Help Financial Management
Reference no: EM131022491

You are scheduled to receive annual payments of $10,400 for each of the next 20 years. Your discount rate is 9 percent. What is the difference in the present value if you receive these payments at the beginning of each year rather than at the end of each year?

Reference no: EM131022491

Questions Cloud

The risk-free rate of return-dividend per share expected : The risk-free rate of return is 8%, the required rate of return on the market is 13%, and High-Flyer stock has a beta coefficient of 2.4. If the dividend per share expected during the coming year, D1, is $4.50 and g = 6%, at what price should a share..
Stipulated that the pain and suffering plus legal expenses : It is now December 31, 2015 (t=0), and a jury just found in favor of a woman who sued the city for injuries sustained in a January 2014 accident. She requested recovery of lost wages plus $300,000 for pain and suffering plus $60,000 for legal expense..
Using more debt financing and less equity financing : There are some elements of a firm’s capital structure that can be adjusted. However, there are some elements that cannot be changed. Why can’t we change the cost of capital of the firm by using more debt financing and less equity financing?
Assets-liabilities and equity total revenue and net income : Use the Income Statement and Balance Sheet to determine the changes in: assets, liabilities, and equity total revenue and net income Briefly describe the change from the current and prior years in each of these key areas and determine if the changes ..
Annual payment-what is difference in the present value : You are scheduled to receive annual payments of $10,400 for each of the next 20 years. Your discount rate is 9 percent. What is the difference in the present value if you receive these payments at the beginning of each year rather than at the end of ..
Two different methods for providing home health services : Capital Healthplans Inc. is evalauating two different methods for providing home health services to its members. Both methods involvce contracting out for services, and the health outcomes and revenues are not affected by the methos chosen. if the op..
What price should a share sell : The risk-free rate of return is 8%, the required rate of return on the market is 13%, and High-Flyer stock has a beta coefficient of 2.4. If the dividend per share expected during the coming year, D1, is $4.50 and g = 6%, at what price should a share..
Common stock pays an annual dividend per share : A common stock pays an annual dividend per share of $2.60. The risk-free rate is 10% and the risk premium for this stock is 6%. If the annual dividend is expected to remain at $2.60, what is the value of the stock? (Round your answer to 2 decimal pla..
Debt-equity ratio-weighted average cost of capital : The Felix Filter Corp. maintains a debt-equity ratio of .6. The cost of equity for Richardson Corp. is 16%, the cost of debt is 11% and the marginal tax rate is 30%. What is the weighted average cost of capital?

Reviews

Write a Review

Financial Management Questions & Answers

  Writing a business plan to create financials as part of the

writing a business plan to create financials as part of the business plan.section 1 start-up expenses and

  Gas powered or electric powered forklift truck

Company must choose between a gas powered or electric powered forklift truck. Electric truck will cost more but less expensive to operate its price is $21,000 the gas powered is $17,960. Cost of capital applied to both at 13%. Life expectancy for bot..

  What is the value of the unlevered firm and tax shield

Merger Valuation with Change in Capital Structure Hastings Corporation is interested in acquiring Vandell Corporation. Vandell has 1 million shares outstanding and a target capital structure consisting of 30% debt; its beta is 1.50. What is the value..

  Calculate accounts receivable-inventory-current assets

You are given the following selected financial information for The Blatz Corporation. Income Statement Balance Sheet COGS $750 Cash $250 Net Income $160 Net fixed assets $850 Ratios ROS 10% Current ratio 2.3 Inventory Turnover 6.0 x ACP 45 days Debt ..

  The stock price will grow at a constant

Which is the amount that should be paid for a stock that will pay a dividend of $3.18 in one year and $5.57 in two years? After that, the stock price will grow at a constant 5% per year forever.  The appropriate discount rate is 12%. Show your answer..

  Calculate the annual cost of each of the three accounts

Judith Bao is a registered nurse who earns $3,250 per month after taxes. She has been reviewing her savings strategies and current banking arrangements to determine if she should make any changes. Calculate the annual cost of each of the three accoun..

  Equity financing and levered financing

Aspen Company is financed with $50 million of 8% debt and $75 million of common equity. The firm has 1 million shares of common stock outstanding. Aspen needs to raise $20 million and is undecided between two possible plans for raising this capital: ..

  As bondholders required rates of return change

As bondholders' required rates of return change, the ________ of outstanding bonds will also change.

  Expected return on the market

A stock has an expected return of 11 percent, its beta is 1.20, and the risk-free rate is 4.4 percent. What must the expected return on the market be?

  What is the percentage price change of these bonds

Bond J has a coupon rate of 4 percent and Bond K has a coupon rate of 10 percent. Both bonds have 17 years to maturity, make semi annual payments, and have a YTM of 7 percent. If interest rates suddenly rise by 2 percent, what is the percentage price..

  Bond is premium bond making semiannual payments

Bond X is a premium bond making semiannual payments. The bond pays a 10 percent coupon, has a YTM of 8 percent, and has 20 years to maturity. Bond Y is a discount bond making semiannual payments. what do you expect the price of these bonds to be one ..

  Assets-liabilities and owners equity

Assets $33,559 million 2. Liabilities $17,026 million 3. Owner’s Equity $16,533 million If the company were liquidated at the end of the fiscal year 2012, are the shareholders guaranteed to receive the total shown in your answer to number 1 above for..

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd