Pension liability-what is present value of this liability

Assignment Help Financial Management
Reference no: EM131330117

Imprudential, Inc., has an unfunded pension liability of $576 million that must be paid in 25 years. To assess the value of the firm’s stock, financial analysts want to discount this liability back to the present. If the relevant discount rate is 6.9 percent, what is the present value of this liability? (Enter your answer in dollars not in millions, e.g., 1,234,567. Do not round intermediate calculations and round your final answer to 2 decimal places, e.g., 32.16.)

Reference no: EM131330117

Questions Cloud

Firm recent earnings per share and dividend per share : Suppose that a firm's recent earnings per share and dividend per share are $2.50 and $1.50, respectively. Both are expected to grow at 9 percent. However, the firms current P/E ratio of 24 seems high for this growth rate. Compute the value of this st..
Discuss about the basics of legal research : Describe two (2) ways in which using an electronic research tool could increase your productivity on the case.Explain two (2) ways that you could use electronic spreadsheets in order to organize your case load.Explore the concept of document review, ..
Problem regarding the webpage development : HTML is usually attached to webpage development, giving instructions to a web browser on how to display the webpage, how does it work with mobile development?
Calculate the pressure in bar : Calculate the pressure in bar that would be equivalent to the attractive force between the Na + and Cl - ions in a salt crystal, at a separation of 2.81 Å and approximating the area over which the force works to be 4.00A2 .
Pension liability-what is present value of this liability : Imprudential, Inc., has an unfunded pension liability of $576 million that must be paid in 25 years. To assess the value of the firm’s stock, financial analysts want to discount this liability back to the present. If the relevant discount rate is 6.9..
Security considerations for temporary or contract workers : What attributes do organizations seek in a candidate when hiring InfoSec professionals? Prioritize this list of attributes and justify your ranking.
Internet transport services proposal using microsoft : You are a Network Engineer for an IT consulting company. Your current client is a software developer. Recently they created a software which is capable of file transfers, voice chat, and videoconferencing. Your manager has tasked you with creating..
What is the minimum change to the entropy of the surrounding : If during the compression stroke the entropy of the gas is reduced by 0.20JK -1 , what is the minimum change to the entropy of the surroundings?
Discuss the key points of the case study : Discuss the key points of the case study, include in your discussion the following points: Overview of the organization The business problem The IT solution that solved the problem

Reviews

Write a Review

Financial Management Questions & Answers

  Net present value and shareholder wealth maximization

How do you think today's low interest rate environment is impacting the time value of money? How might this change the value of an asset or liability? What is the relationship between the concepts of net present value and shareholder wealth maximizat..

  What is the operating cash flow for the project

You are evaluating a project for The Tiff-any golf club, guaranteed to correct that nasty slice. You estimate the sales price of The Tiff-any to be $440 per unit and sales volume to be 1,000 units in year 1; 1,500 units in year 2; What is the operati..

  Amount of funds year to cover anticipated cash outflow

The Great Giant Corp. has a management contract with its newly hired president. The contract requires a lump sum payment of $25,400,000 be paid to the president upon the completion of her first 8 years of service. The company wants to set aside an eq..

  Bond issue outstanding with an annual coupon

Potter Industries has a bond issue outstanding with an annual coupon of 6% and a 10-year maturity. The par value of the bond is $1,000. If the going annual interest rate is 7.2%, what is the value of the bond?

  Using ratios to construct financial statements

Using ratios to construct financial statements [LO2] The Griggs Corporation has credit sales of $908,950. Total assets turnover 2.65 times Cash to total assets 1.95 % Accounts receivable turnover 10 times Inventory turnover 14 times Current ratio 1.7..

  Forecasting interest rates based on prevailing

forecasting interest rates based on prevailing conditions.consider the prevailing conditions for the following factors

  What is the future value of these cash flows

If the discount rate is 6 percent, what is the future value of these cash flows in Year 4? What is the future value at an interest rate of 14 percent?  What is the future value at an interest rate of 21 percent?

  New purchase price for the existing stockholders

Katie Homes and Garden Co. has 10,640,000 shares outstanding. The stock is currently selling at $52 per share. If an unfriendly outside group acquired 25 percent of the shares, existing stockholders will be able to buy new shares at 30 percent below ..

  Market value equal to its book value

Jenningston Mills has a market value equal to its book value. Currently, the firm has excess cash of $1,200, other assets of $5,800, and equity valued at $3,750. The firm has 250 shares of stock outstanding and net income of $420. What will the new e..

  What is the value of your firms stock

Suppose your company is expected to grow at a constant rate of 6 percent long into the future. In addition, its dividend yield is expected to be 8 percent. If your company expects to pay a dividend equal to $1.06 per share at the end of the year, wha..

  Find its current p and e ratio

Ider Corp expects to have $3.73 as earnings per share next year. The cost of equity for Ider is 16%, whereas its dividend yield is 4%. The price per share of Ider is $40. Find its current P/E ratio.

  What damages does defendant owe the plaintiff

Sasha is bartending at The Right Round, a nearby pub, because her new song isn’t selling very well. She sees Joe-Lo, a regular customer at The Right Round, is clearly intoxicated. He asks her for one more round of drinks before he leaves. Did defenda..

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