What if the rate was compounded daily

Assignment Help Financial Management

Reference no: EM131054767

Assume that you have been quoted an investment that will pay you $1000 each month for the next 40 years. If you are quoted a 5.00% rate compounded monthly.

1. How much would you value this cash flow?

2. What if the rate was compounded daily? Note: the cash flows remain monthly

Reference no: EM131054767

Questions Cloud

What would be the third year future value : A deposit of $360 earns the following interest rates: What would be the third year future value?

What is the total asset turnover and the capital intensity : Silas 4-Wheeler, Inc., has an ROE of 17.47 percent, equity multiplier of 1.40, and a profit margin of 16.00 percent. What is the total asset turnover and the capital intensity?

Calculate the basic earnings power-dividend payout : Maggie’s Skunk Removal Corp.’s 2015 income statement listed net sales of $14.1 million, gross profit of $9.00 million, EBIT of $7.2 million, net income available to common stockholders of $4.8 million, and common stock dividends of $2.8 million. Calc..

Calculate the market-to-book ratio : You are considering an investment in Roxie's Bed & Breakfast Corp. During the last year, the firm's income statement listed an addition to retained earnings of $15.60 million and common stock dividends of $1.40 million. What is Roxie's Bed & Breakfas..

What if the rate was compounded daily : Assume that you have been quoted an investment that will pay you $1000 each month for the next 40 years. If you are quoted a 5.00% rate compounded monthly. How much would you value this cash flow? What if the rate was compounded daily? Note: the cash..

Firm uses payback period criteria of not accepting project : AMP INC has invested $2,165,800 on equipment. The firm uses payback period criteria of not accepting any project that takes more than 4 years to recover costs. The company anticipates cas flows of $451,386, $512,178, $561,755, $764,997, $816,500, and..

Reported a debt-to-equity ratio : Tiggie's Dog Toys, Inc. reported a debt-to-equity ratio of 1.71 times at the end of 2015. If the firm's total debt at year-end was $29 million, how much equity does Tiggie's have on its balance sheet? (Enter your answer in millions of dollars rounded..

Identifying agency problems-costs and resolutions : Identifying agency problems, costs, and resolutions Explain why each of the following situations is an agency problem and what costs to the firm might result from it. Suggest how the problem might be handled short of firing the individual(s) involved..

What is the yield on the bond : You have been asked to determine a rate on a bond. It has a maturity of 10 years, a coupon of 6.00%, and a par value of 1000. You are given the following information. What is the yield on the bond? What is the nominal rate of the ten-year treasury?

User Account

All Pages