What is the present value of the annuity

Assignment Help Finance Basics
Reference no: EM13264692

An investor will receive an annuity of $5,000 a year for seven years. The first payment is to be received 5 years from today. If the annual interest rate is 11.5%, what is the present value of the annuity? What is the after tax present value of the annuity if the investor is in the 28% marginal tax bracket?

Reference no: EM13264692

Questions Cloud

What electrical component is equivalent to a dashpot : If a spring is considered as being equivalent to an electrical resistance where force=voltage and displacement=current, then what electrical component is equivalent to a dashpot?
What is the companys weighted average cost of capital : What is the company's weighted average cost of capital?
Explain the relative strength of the intermolecular forces : Match the following properties of liquids to what they indicate about the relative strength of the intermolecular forces in that liquid. Strong intermolecular forces: Weak intermolecular forces
Category of positive or neutral communications : Most messages we write in the work place fall into the category of positive or neutral communications. Examples include routine requests, informative or good news announcements, replies to inquires, messages granting claims, letters of recommendation..
What is the present value of the annuity : What is the after tax present value of the annuity if the investor is in the 28% marginal tax bracket?
Calculate the required return based on the capm : Based on the following information, calculate the required return based on the CAPM.
Explain converter operation in a continuous-conduction mode : In a step-down converter, consider all components to be ideal. Let v_0 = V_0 be held constant at 5 V by controlling the switch duty ratio D. Calculate the minimum inductance L required to keep the converter operation
Explain what kelvin temperature will the vapor pressure : A certain substance has a heat of vaporization of 74.45 kJ/mol. At what Kelvin temperature will the vapor pressure be 6.50 times higher than it was at 287 K
Example of a specific value-added service : Provide one example of a specific value-added service, and demonstrate the fundamental manner in which the service in question would correspond to market entry or competitive strategy.

Reviews

Write a Review

Finance Basics Questions & Answers

  Present value of three year cash-flow stream

Find out the present value of following three year cash-flow stream if your interest rate is 6%.... Year 1 $200, Year 2 $400 Year 3 $300 ?

  Calculate the npv of going directly to market now

Required: (a) Calculate the NPV of going directly to market now. (Do not include the dollar sign ($). Enter your answer in dollars, not millions of dollars. (e.g., 1,234,567)) NPV $ (b) Calculate the NPV of test marketing first.

  Calculate total and annual cost

An oil firm arranged a $10,000,000 revolving credit agreement with a group of small banks. The company paid an yearly commitment fee of one-half of one percent of the unused balance of loan commitment.

  Require to cash in at the end of ten years

you will require to cash in at the end of ten years. suppose your brother is trustworthy and both investments carry similar risk.

  Determine financial markets

Determine financial markets and what function do they perform? How would an economy beworse off without them?

  What is the addition to retained earnings

Dividends and retained earnings. Suppose the firm in problem 2 paid out $56,000 in cash dividends. What is the addition to retained earnings?

  Commodities and financial future

Not long ago, vanessa woods sold her company for several million dollars (after taxes). She took some of that money and put it into the stock market. Today, vanessa's portfolio of bluechip stocks is worth 3.8 million. Why would she choose to hedge..

  Calculating wacc for american express

American Express common stock has a beta of 1.4. If the risk free rate is 8 percent. If the expected market return is 16 percent and American Express has 20 million of 8% debt.

  What was the cash flow from the project

The only capital investment required for a small project is investment in inventory. Profits this year were $11,800, and inventory increased from $4,900 to $6,800. What was the cash flow from the project?

  Discuss one or two methods used in capital budgeting process

what is being invested to receive an acceptable return. Discuss one or two methods used in the capital budgeting process and the advantages that each represent.

  . what is the weight of the preferred stock to firm''s weight

Jack's Construction Co. has 100,000 bonds outstanding that are selling at par value. The bonds yield 9.5 percent. The company also has 4.0 million shares of common stock outstanding. The stock has a beta of 1.2 and sells for $55 a share. The U.S. Tre..

  What would best characterize ms. hernandez investment goal

Tracey Hernandez is 26 and has saved enough money for an emergency fund, along with an additional $4,500 for an investment program. She is single with no dependents and has a desire to retire at 65. What would best characterize Ms. Hernandez's inv..

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