What is a fair price for the investment

Reference no: EM13258258

An investment promises to pay you exactly $10,000, exactly 4 years from today, and the investment (in addition) pays you (a second cash flow of) exactly $110,000 in exactly 5 years from today. The required rate of return is 10%. What is a fair price for the investment - assuming the discount rate and expected cash flows don't change - exactly 3 years from today. (In other words, what would the investment sell for in 3 years?

Reference no: EM13258258

Questions Cloud

Develop policies to enhance customer profitability : After critical success factors (CSFs) have been identified, the next step in developing a competitive strategy is to develop relevant and reliable measures for these CSFs.

What is the beta of your portfolio : Assume that you have $100,000 invested in a stock whose beta is .85, $200,000 invested in a stock whose beta is 1.05, and $300,000 invested in a stock whose beta is 1.25. What is the beta of your portfolio?

Find the reflection and transmission coefficient : A plane wave in air with an electric field amplitude of 20 V/m is incident normally upon the surface of a lossless, nonmagnetic medium with Xr er = 25. Determine the following: a.) reflection and transmission coefficient

Provide examples of a correctly designed : Discuss and provide examples of a correctly designed and coded class definition and then provide an example of how the objects of that class would be instantiated.

What is a fair price for the investment : The required rate of return is 10%. What is a fair price for the investment - assuming the discount rate and expected cash flows don't change - exactly 3 years from today. (In other words, what would the investment sell for in 3 years?

Which one is truly the better offer : You are quoted two loan rates: 1) a 9% APR with weekly compounding and 2) a 9.2% APR with yearly compounding. Which one is truly the better offer? Do the necessary calculations to support your answer.

State koh solution is added the ph in the titration flask : 50.00 mL of 0.10 M HNO2 (nitrous acid, Ka = 4.5 ´ 10-4) is titrated with a 0.10 M KOH solution. After 25.00 mL of the KOH solution is added, the pH in the titration flask will be

Find the uncertainty in momentum of the helium atom : Helium forms a solid at low temperatures and high pressures. To maintain the order present in a solid, each atom must remain at its assigned position, Find the uncertainty in momentum of the helium atom

Disclosure requirements for non-listed companies : Which of the following schedule provides disclosure requirements for Non-Listed Companies under Companies Ordinance 1984?

User Account

All Pages