What is the present value as of today

Assignment Help Financial Management
Reference no: EM131346237

You recieve a payment today of $2,000,000, and then monthly payments of $35,000 each for 4 years (48 total monthly payments), with the first of the monthly payments occurring one year from today. If you use a discount rate of 2.28% APR with monthly compounding, what is the present value as of today ?

Reference no: EM131346237

Questions Cloud

Determine approximately how much additional financing : The Danville Company is considering a $50 million expansion (capital expenditure) program next year. The company wants to determine approximately how much additional financing will be needed if the expansion program is undertaken. Long-term debt reti..
An all-equity firm is considering the projects : An all-equity firm is considering the following projects: Project Beta Expected Return W .70 11% X .95 13 Y 1.05 14 Z 1.60 16 The T-bill rate is 5 percent, and the expected return on the market is 12 percent. Which projects have a higher expected ret..
The cost of debt capital for a firm : The cost of debt capital for a firm
Monthly payments occurring one year from today : You recieve a payment today of $2,000,000, and then monthly payments of $35,000 each for 4 years (48 total monthly payments), with the first of the monthly payments occurring one year from today. If you use a discount rate of 2.28% APR with monthly c..
What is the present value as of today : You recieve a payment today of $2,000,000, and then monthly payments of $35,000 each for 4 years (48 total monthly payments), with the first of the monthly payments occurring one year from today. If you use a discount rate of 2.28% APR with monthly c..
What is investment in risk-free asset : You want to create a portfolio equally as risky as the market, and you have $1,400,000 to invest. What is the investment in risk-free asset? What is the investment in Stock C?
The percentage of sales forecasting method : The percentage of sales forecasting method is used by management to forecast the amount of
Use the net present value method : Universal Electronics is considering the purchase of manufacturing equipment with a 10-year midpoint in its asset depreciation range (ADR). The asset will cost $120,000, and it will produce earnings before depreciation and taxes of $37,000 per year f..
Expansion project-requires initial fixed asset investment : Quad Enterprises is considering a new three-year expansion project that requires an initial fixed asset investment of $2.43 million. The fixed asset will be depreciated straight-line to zero over its three-year tax life, after which time it will be w..

Reviews

Write a Review

Financial Management Questions & Answers

  Flotation costs for new issuances of preferred stock

A firm's preferred stock pays an annual dividend of $8, and the stock sells for $72. Flotation costs for new issuances of preferred stock are 3% of the stock value. What is the after-tax cost of preferred stock if the firm's tax rate is 38%?

  Purchased a zero-coupon bond one year

You purchased a zero-coupon bond one year ago for $277.33. The market interest rate is now 8 percent. Required: If the bond had 17 years to maturity when you originally purchased it, what was your total return for the past year?

  Treasury bond rate-derive stock price of this company

We have the following information for the company. The stock pays a $10 dividend, and it will grow by 100% the first year, 30% the second year and 3% forever after that. The unlevered beta is 1, D/E is 60/40 and the tax rate is .3. Additionally, we k..

  Define arbitrage and the law of one price

What is an efficient market? Why do efficient markets benefit society? Define arbitrage and the law of one price. What role do they play in our market system?

  The central bank decides to push long run inflation to zero

How The central bank decides to push long-run inflation to zero events affect the risk of a liquidity trap?- The neutral real interest rate rises.

  Statements must be true about securities

Stock A's beta is 1.7 and Stock B's beta is 0.7. Which of the following statements must be true about these securities? (Assume market equilibrium.)

  Find the option price and the replicating strategy

Let s(0)= 120 dollars and let U=0.2, D= -0.1, R=0.1. Consider a call option with a strike price X=120 and exercise time T =2. Find the option price and the replicating strategy.

  Explain how managed earnings might threaten credibility

Explain how “managed earnings” might threaten the credibility of the U.S. financial reporting system. But should we abolish managed earnings? Why is it important to manage earnings?

  What will be the loan balance at the end of year 3

How much total interest will be paid from all payments? How much total amortization will be paid?- What will be the loan balance at the end of year 3?

  Determine the qsd and set up a floating for floating rate

Determine the QSD and set up a floating-for-floating rate swap where the swap bank receives .125 percent and the two counterparties share the remaining savings equally.

  Which will be depreciated using straight-­-line

A doggy day care center is replacing old equipment and installing three new pieces of equipment for a total cost of $250,000, which will be depreciated using straight-­-line over four years. The old equipment being replaced will be sold for $35,000 a..

  Assuming the yield to maturity remains? constant

Suppose that General Motors Acceptance Corporation issued a bond with 10 years until? maturity, a face value of $1,000?, and a coupon rate of 7.9% ?(annual payments). Assuming the yield to maturity remains? constant, what is the price of the bond imm..

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