User Account

All Pages

What is the present value of an annuity

Assignment Help Accounting Basics
Reference no: EM131789403

Question - Time Value of Money

a. What is the real future value of $10,000 which will sit in a savings account for 20 years, earning 4% interest compounded yearly during a period of 4% annual inflation?

b. What is the present value of an annuity which makes its first payment in 3 years, makes a total of 10 payments of $10,000 each year with an overall discount rate of 7%?

c. What is the PV of a perpetuity which pays $200 one year from today and then each year thereafter? Assume a discount rate of 8%.

d. What is the nominal future value of $10,000 one year from today if it can be invested in a portfolio that expects to earn, in real terms, 4% per year with inflation of 3% per year?

Reference no: EM131789403

Questions Cloud

How many analysts rated the company : How many analysts rated the company? How do the analysts rank this company among all the companies in its industry
Strategic implications of how an organization produces : Consider the strategic implications of how an organization produces and interacts with its partners, customers, and suppliers.
Formulating the benefit-cost ratio criteria : Haryana government is considering to extend Bhakra canal into a desert area for irrigation. The initial cost of the project is expected to be Rs 3.75 crore.
How does agile project management expose poor work processes : How does agile project management expose poor work processes or stumbling blocks within organizations? How is this beneficial for an organization?
What is the present value of an annuity : What is the present value of an annuity which makes its first payment in 3 years, makes a total of 10 payments of $10,000 each year
Discuss the company did not issue any bonds payable : The company paid a cash dividend of $48,600 and it did not dispose of any long-term investments or property, plant, and equipment
What will the customer be charged : A customer places 10 orders with a total direct cost of $3,000, orders 300 separate items, and makes 5 returns. What will the customer be charged
According to the national climatic data center : According to the National Climatic Data Center, during 1991, the lowest temperature recorded in Indianapolis, Indiana, was 0°F. If x is the wind speed
According to the national climatic data center : According to the National Climatic Data Center, during 1991, the lowest temperature recorded in Indianapolis, Indiana, was 0°F. If x is the wind speed

Reviews

Write a Review

Accounting Basics Questions & Answers

  How much control does fed have over this longer real rate

Hubbard argues that the Fed can control the Fed funds rate, but the interest rate that is important for the economy is a longer-term real rate of interest.   How much control does the Fed have over this longer real rate?

  Coures:- fundamental accounting principles

Coures:- Fundamental Accounting Principles: - Explain the goals and uses of special journals.

  Accounting problems

Accounting problems,  Draw a detailed timeline incorporating the dividends, calculate    the exact Payback Period  b)   the discounted Payback Period. the IRR,  the NPV, the Profitability Index.

  Theory of interest - term structure of interest rates

Term Structure of Interest Rates

  Write a report on internal controls

Write a report on Internal Controls

  Prepare the bank reconciliation for company

Prepare the bank reconciliation for company.

  Cost-benefit analysis

Create a cost-benefit analysis to evaluate the project

  Theory of interest

Theory of Interest: NPV, IRR, Nominal and Real, Amortization, Sinking Fund, TWRR, DWRR

  Liquidity and profitability

Distinguish between liquidity and profitability.

  What is the expected risk premium on the portfolio

Your Corp, Inc. has a corporate tax rate of 35%. Please calculate their after tax cost of debt expressed as a percentage. Your Corp, Inc. has several outstanding bond issues all of which require semiannual interest payments.

  Simple interest and compound interest

Simple Interest, Compound interest, discount rate, force of interest, AV, PV

  Capm and venture capital

CAPM and Venture Capital

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!

Submit Assignment

Academics

Major Subjects

Majors

Get In Touch

whatsapp: +91-977-207-8620

Phone: +91-977-207-8620

Email: [email protected]

TERMS & POLICIES

HELP & SUPPORT

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd