Already have an account? Get multiple benefits of using own account!
Login in your account..!
Remember me
Don't have an account? Create your account in less than a minutes,
Forgot password? how can I recover my password now!
Enter right registered email to receive password!
An insurance company offers you and end of year annuity of $48,000 per year for the next 20 years. They claim your return on the annuity is 9%. What is the most you would be willing to pay today for this annuity?
a
Amount offered every year by
insurance company
mce_markernbsp; 48,000.00
b
Period (Years)
20
c
Interest rate claimed
9%
d
Present Value of the annuity
of 20 years
$438,170.19
Note: Assumed amount received at the end of the year.
Example of Net Present Value Method Cost of investment = 100,000/=, Interest rate = 10percent, Inflows year 1 = 80,000/= Year 2 = 50,000/= NPV = 80,000 / 1.1 + 5
Constant DPS plus Extra or Surplus 1. Beneath this policy a constant DPS is paid every year. Nonetheless extra dividends are paid in years of supernormal earnings. 2. It prov
Define benefit plan for the employee participants
Disadvantages of Overdraft Finance A. It is expensive as the interest rates of overdrafts are much higher than bank rates. B. The employ of this finance is an indication of
Define the direct finance and indirect finance in markets. In direct finance, borrower-spenders borrow funds directly by lenders into the financial markets through selling them
Dividend Cover Ratio Dividend cover = EPS/ DPS = Earning to ordinary shares/Dividend paid This signifies the number of times dividend can be paid from earnin
Classification of New Issue Market New market can be classified as: (i) A market where firms go to public for the first time through initial public offering (IPO). (ii
A. Michael Spence An American economist who was awarded by the Nobel Memorial Prize in Economic Sciences. Spence is a lecturer of management at Stanford University in the Gradu
Yard Stick Required in Ratio Analysis 1. Past performance of the company The company's previous performance past ratio is needed to gauge or measure the company's present
Advantage of Joint Stock Companies The company can own assets and incur liabilities on its own accord. Perpetual existence as or going to relate that allows the compan
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!
whatsapp: +91-977-207-8620
Phone: +91-977-207-8620
Email: [email protected]
All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd