What is the present value when the annual increase

Assignment Help Macroeconomics
Reference no: EM13327011

A set of cash flows begins at $20,000 the first year, with an increase each year until n = 10 years. If the interest rate is 8%, what is the present value when

a) the annual increase is $2000?

b) the annual increase is 10%?

Reference no: EM13327011

Questions Cloud

Determine the compressor power : At a steady state, a well-insulated compressor takes in air at 60 degrees Fahrenheit, 14.2 lbf/in^2, Determine the compressor power
A vacuum oven for brazing small fittings : Emma runs a small factory that needs a vacuum oven for brazing small fittings. She can purchase the model she needs for $180,000 up front, or she can lease it for $4,200 per month. She can borrow at 7% APR, compounded monthly. Assuming that th..
What is the effective annual interest rate : A bank is offering $20,000 6-month CD's for $19,500. What is the nominal annual interest rate? What is the effective annual interest rate? please give both the answers in %.
Use the cyberattack scenario : Imagine that you occupy one of the following positions: the police chief, the city mayor, the bank's chief executive officer, the airport's director of security, or the hospital's chief executive officer.
What is the present value when the annual increase : A set of cash flows begins at $20,000 the first year, with an increase each year until n = 10 years. If the interest rate is 8%, what is the present value when
Determine what is geometric return over the period : Your grandfather invested $1,000 in a stock 27 years ago. Currently the value of his account is $226,000. What is his geometric return over this period
Calculate the npv of the investment for 10 years : Archer Daniels Midland Company is considering buying a new farm that it plans to operate for 10 years. The farm will require an initial investment of $12.20 million.
How long would it take to pay off the loan : Two years ago I bought a new car for $36,000.If my monthly payment was $500.00 and my interest rate was 3% compounded monthly,how long would it take to pay off the loan?
Real wage rate if the labor supply function is positively : A sharp decrease in housing prices makes people much less wealthy. If the primary effect of this decreased wealth is felt on labor supply, what happens to the level of employment and the real wage rate if the labor supply function is positively relat..

Reviews

Write a Review

Macroeconomics Questions & Answers

  How does the money multiplier change when the nonbank public

How does the money multiplier change when the nonbank public decides to hold more currency relative to deposits?

  Instrumental variable regression model

Consider the instrumental variable regression model Y i  β 0  + β 1  X 1 + β 2  X 1 +u i , where Z i  is an instrument

  Illustrate what will be the new evel of quantity demanded

If High-Time lowers the price, Illustrate what will be the new evel of quantity demanded. Of the new revenue

  How it is possible for the price of water to be much lower

"Nothing is more useful than water: but it will purchase scarce anything; scarce anything can be had in exchange for it. A diamond, on the contrary, has scarce any value in use; but a very great quantity of other goods may frequently be had in exc..

  What arrangements is zaneb likely to encounter

Zaneb is a high-school teacher and is well known in her community for her honesty and integrity. She is shopping for a new car and plans to borrow the money to pay for it from her local bank. Does Zaneb create any moral hazard or adverse selection..

  What are the opportunity costs of the decisions

Gourmet coffee houses tend to open in high-rent areas and cater to higher income consumers. Because of the change they created for taste and preferences and the higher income market, the gourmet coffee houses had a win-win in a period of falling w..

  Determine what the shop would pay if its output were zero

Suzy is considering opening a restaurant. To do so, she would have to quit her current job which pays $20,000 a year and use her own car which she currently leases out to her brother for $2,000 a year.Her expenses at the restaurant would be $60,000..

  Calculate the eoq and total cost

You need $50,000 cash throughout year. Your time is worth $100 per hour and it takes you a half-hour to get cash from your ATM. Your bank is paying 5% per annum passbook savings.

  Explain the concept of demand with the examples

In economics, demand for a product is considered downward sloping. This implies that quantity demanded rise when price reduce.

  Difference between representative money or commodity money

Why is representative money more useful than commodity money. representative money has value because the government says it does or else.

  Calculating output level of a plant

A company has two plants with the following marginal cost functions: MC1 = 20 +2Q1, MC2 = 10 +5Q2 Where MC1 is marginal cost in 1st plant,

  How to identify when recessions begin

The table below contains data from the Bureau of Economic Analysis (BEA) on real GDP in the United States for 1980 to 1984. During this period, the United States experienced economic fluctuations (one recession and periods of economic growth).

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