What is the present value of the annuity

Assignment Help Finance Basics
Reference no: EM13264692

An investor will receive an annuity of $5,000 a year for seven years. The first payment is to be received 5 years from today. If the annual interest rate is 11.5%, what is the present value of the annuity? What is the after tax present value of the annuity if the investor is in the 28% marginal tax bracket?

Reference no: EM13264692

Questions Cloud

What electrical component is equivalent to a dashpot : If a spring is considered as being equivalent to an electrical resistance where force=voltage and displacement=current, then what electrical component is equivalent to a dashpot?
What is the companys weighted average cost of capital : What is the company's weighted average cost of capital?
Explain the relative strength of the intermolecular forces : Match the following properties of liquids to what they indicate about the relative strength of the intermolecular forces in that liquid. Strong intermolecular forces: Weak intermolecular forces
Category of positive or neutral communications : Most messages we write in the work place fall into the category of positive or neutral communications. Examples include routine requests, informative or good news announcements, replies to inquires, messages granting claims, letters of recommendation..
What is the present value of the annuity : What is the after tax present value of the annuity if the investor is in the 28% marginal tax bracket?
Calculate the required return based on the capm : Based on the following information, calculate the required return based on the CAPM.
Explain converter operation in a continuous-conduction mode : In a step-down converter, consider all components to be ideal. Let v_0 = V_0 be held constant at 5 V by controlling the switch duty ratio D. Calculate the minimum inductance L required to keep the converter operation
Explain what kelvin temperature will the vapor pressure : A certain substance has a heat of vaporization of 74.45 kJ/mol. At what Kelvin temperature will the vapor pressure be 6.50 times higher than it was at 287 K
Example of a specific value-added service : Provide one example of a specific value-added service, and demonstrate the fundamental manner in which the service in question would correspond to market entry or competitive strategy.

Reviews

Write a Review

Finance Basics Questions & Answers

  Payoff diagram for a stock and a bond

Make a final payoff diagram for a stock and a bond.

  What is the projects year 0 net cash flow

The project requires an initial investment in net working capital of $285,000 and the fixed asset will have a market value of $225,000 at the end of the project.

  Explain the term direct finance

If financial markets operated perfectly and without cost financial intermediaries would not exist. All finance would be direct finance. Describe what is meant by the term direct finance.

  Reasons for business to file for bankruptcy

There're many reasons why a business may file for bankruptcy. Describe the reasons that would drive a business to file for bankruptcy.

  Recommendation to buy different u.s. growth stock funds

As an individual investor, you are attempting to invest in a well-diversified portfolio of mutual funds so that you will be somewhat insulated from any type of economic shock that may occur. Describe recommendation to buy four different U.S. growth s..

  Is this a smart move by netflix

Is this a smart move by Netflix? Discuss the pros and cons of such a drastic price increase.

  Why is the final amount in each mutual fund different

You invest $3,000 annually in a mutual fund that earns 10% annually, and you reinvest all the distributions. How much will you have in the account at the end of 20 years?

  Foreign corporate tax rate

Suppose England raised its corporate tax rate by 1 percentage point from 40% to 41%. How would this increase affect the economics of a U.S.-U.K. foreign expansion project?

  Estimate the enterprise value

Heavy Metal Corporation is expected to generate the following free cash flows over the next 5 years:

  Compute the amount at the end of the year

Suppose you have been hired to run a pension fund for TelDet Corporation, a small manufacturing firm. The firm currently has $5 million in the fund and expects to have cash inflows of $2 million a year for 1st 5-years followed by cash outflows of $3 ..

  Find out the present value of given each petuities

Find out the present value of given each petuities. Each petuity with $1000 annual payment discounted.

  Find the market value of assets

Beckman Engineering and Associates has 25 million shares outstanding. Shares are trading at $8. Beckman Engineering and Associates management plans to raise $60 million to by issuing debt to repurchase shares.

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