Investment that generates the cash flows

Assignment Help Financial Management
Reference no: EM13811648

You have just purchased an investment that generates the following cash flows for the next four years. You are able to reinvest these cash flows at 10.6 percent, compounded annually.

End of year

1.   $1,567

2.   $1,222

3.   $1,730

4.   $319

What is the present value of this investment if 10.6 percent per year is the appropriate discount rate?

Round the answer to two decimal places.

Reference no: EM13811648

Questions Cloud

What should be the role of training : What is HR's role in impacting your the career development of employees? What should be the role of training? How can training programs be evaluated on their effectiveness
Determine the total value that has to be paid back : Jane buys furniture at the value of R10000. She lends the money on the 1st of February at a financial institute. Determine the total value that has to be paid back on 1July 2015 and How many months will it take Jane to pay the loan back.
Morality and professionalism : Morality and Professionalism
What is the role of hr in performance evaluation : Read the article and in 200-250 words evaluate whether your company's formal performance evaluation process is effective. What steps could be taken to make it more effective? What is the role of HR in performance evaluation? Who is responsible for..
Investment that generates the cash flows : You have just purchased an investment that generates the following cash flows for the next four years. You are able to reinvest these cash flows at 10.6 percent, compounded annually.
What are the goals of employee selection : In 200 - 250 words, what are the goals of employee selection? Compare and contrast two selection methods and how these selection methods impact the achievement of organizational objectives
What are the financial budgetary implications of the issue : What is the issue's history and where does it stand right now. What are the financial/budgetary implications of the issue
Improve overall sense of community : Scenario: Imagine that you have been hired as a consultant for a university that wants to leverage social media and networking technologies to encourage the collaboration of students, and improve their overall sense of community.
Assume that money that is not withdrawn remains in account : In five years, you plan on starting graduate school to earn your MBA. You know that graduate school can be expensive and you expect you will need $15,000 per year for tuition and other school expenses. Assume that money that is not withdrawn remains ..

Reviews

Write a Review

Financial Management Questions & Answers

  Using the internal rate of return method

King's Department Store is contemplating the purchase of a new machine at a cost of $22,802. The machine will provide $3,500 per year in cash flow for nine years. King's has a cost of capital of 10 percent. Using the internal rate of return method, e..

  Leverage gives the illusion of higher returns

Explain, in your own words, when and how the composition of capital (the mix of debt and equity) does not affect the value of the firm and Discuss this statement: leverage gives the illusion of higher returns.

  Ordinary income and capital gains-initial investment

A corporation has decided to replace an existing asset with a newer model. Two years ago, the existing asset originally cost $30,000 and was being depreciated under MACRS using a five-year recovery period. The existing asset can be sold for $25,000.

  Round lot of francesca industries stock

Suppose you buy a round lot of Francesca Industries stock on 55 percent margin when the stock is selling at $20 a share. The broker charges a 10 percent annual interest rate, and commissions are 3 percent of the stock value on the purchase and sal..

  Potential estate tax liability-estate planning case study

The goal of this Estate Planning Case Study is to make adjustments to an existing estate plan to eliminate the potential estate tax liability. Today is January 2014 John has been your financial planning client for over ten-years. He is 61 and married..

  The firms cost of preferred stock financing

The preferred stock of gator industries sells for $35.86 and pays $2.72 per year in dividends. what is the cost of preferred stock financing? if gator were to issue 483,000 more preferred shares just like the ones it currently has outstanding.

  Find the total amount for accumulation of discount

A 10-year bond with semi-annual coupons is bought at a discount to yield 9% convertible semi-annually. If the amount for accumulation of discount in the next-to-last coupon (which was denoted by P19) is $8, find the total amount for accumulation of d..

  It is now october 2004 a company anticipates that it will

it is now october 2004. a company anticipates that it will purchase 1 million pounds ofcopper in each of february 2005

  Using constant-growth model-estimate value of giants stock

Giant Enterprises’ stock has a required return of 14.8%. The company, which plans to pay a dividend of $2.60 per share in the coming year, anticipates that its future dividends will increase at an annual rate consistent with that experienced over the..

  1 is concerned with the maximization of a firms earnings

1. is concerned with the maximization of a firms earnings after taxes.a shareholder wealth maximizationb profit

  Determine present value

A basketball player has just signed a $30 million contract to play for three years. She will receive $5 million as an immediate cash bonus, $5 million at the end of the first year, $8 million at the end of the second year, and the remaining $12 milli..

  What is profit and loss on the transaction

On August 1, Sonya sells short 100 shares of PDQ company stock for $100 per share. On October 2, Sonya closes out the short sale at a cost of $90 per share. What is Sonya's profit or (loss) on the transaction

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