An asset was issued 28 months ago. The asset promised just one cash flow of $12000,...
An asset was issued 28 months ago. The asset promised just one cash flow of $12000, to be paid to the owner exactly 5 years from the date that the asset was issued. If the required rate of return on this asset is 8%, then what is its present value? Round your answer to the nearest dollar.
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An asset was issued 28 months ago. The asset promised just one
cash flow of $12000,...
An asset has one expected cash flow of $1200, which is expected to occur in 6...
An asset has one expected cash flow of $1200, which is expected to occur in 6 months and a second expected cash flow of $7600, which is expected to occur in 15 months. All payments are equally risky and thus they have the same discount rate. You've decided that the discount rate is 9%. According to these numbers, how much is the asset worth to you today? Round your answer to the NEAREST DOLLAR.
A cash flow of $500,000 may be received by Cynthia Bennett Company in one year, two...
A cash flow of $500,000 may be received by Cynthia Bennett Company in one year, two years, or three years, with probabilities of 30%, 50%, and 20%, respectively. The rate of interest on default risk-free investments is 8%. Required: What is the expected present value of Cynthia Bennett' cash flow? Round your answers to the nearest whole dollar. With details please.
Management of a firm with a cost of capital of 10 percent is considering a $126,000 investment with annual cash flow of...
Management of a firm with a cost of capital of 10 percent is considering a $126,000 investment with annual cash flow of $52,460 for three years. Use Appendix A and Appendix D to answer the questions. What are the investment’s net present value and internal rate of return? Use a minus sign to enter a negative value, if any. Round your answers for the net present value to the nearest dollar and for the internal rate of return to the...
Six years ago the Templeton Company issued 28-year bonds with an 13% annual coupon rate at...
Six years ago the Templeton Company issued 28-year bonds with an 13% annual coupon rate at their $1,000 par value. The bonds had an 8% call premium, with 5 years of call protection. Today Templeton called the bonds. Compute the realized rate of return for an investor who purchased the bonds when they were issued and held them until they were called. Round your answer to two decimal places.
Each of the following scenarios is independent. Assume that all cash flows are after-tax cash flows. a. Campbell Manuf...
Each of the following scenarios is independent. Assume that all cash flows are after-tax cash flows. a. Campbell Manufacturing is considering the purchase of a new welding system. The cash benefits will be $480,000 per year. The system costs $2,700,000 and will last 10 years. b. Evee Cardenas is interested in investing in a women's specialty shop. The cost of the investment is $270,000. She estimates that the return from owning her own shop will be $52,500 per year. She...
Different cash flow. Given the following cash inflow, what is the present value of this cash...
Different cash flow. Given the following cash inflow, what is the present value of this cash flow at 3%, 13%, and 24% discount rates? Year 1 Year 2: Years 3 through 7: Year 8: $1,000 $6,000 SO $26,000 What is the present value of this cash flow at 3% discount rate? SL (Round to the nearest cent.) What is the present value of this cash flow at 13% discount rate? SL (Round to the nearest cent.) What is the present...
The Shallow Company has two bonds outstanding. Bond A was issued exactly 5 years ago at...
The Shallow Company has two bonds outstanding. Bond A was issued exactly 5 years ago at a coupon rate of 9%. Bond Z was issued exactly 1 year ago at a coupon rate of 8%. Both bonds were originally issued with semi-annual coupon payments, terms of 20 years, and face values of $1,000. The current yield to maturity (YTM) is 7.5% for both bonds. Which of the following statements is LEAST correct? The internal rate of return (IRR) on Bond...
QUESTION 26 (5 points) Asset A was purchased six months ago for $15,000 and has generaced...
QUESTION 26 (5 points) Asset A was purchased six months ago for $15,000 and has generaced $1,500 cash flow during that period. What is the asset's rate of return if it can be sold for $16,750 today? T T TT Arial 3(12pt)
A music company is considering creating the world's largest piano. Cost and cash flow details are...
A music company is considering creating the world's largest piano. Cost and cash flow details are listed below. The company requires a 12% return on its capital. a) What is the present value of the yearly cash flows? (round to nearest dollar) b) What is the net present value of the project? (round to nearest dollar) c) What is the internal rate of return of the project? (round to two decimal places) Cost of Project ($2,500,000) Yr 1 cash flow...
Complete the below table to calculate the price of a $1.2 million bond issue under each...
Complete the below table to calculate the price of a $1.2 million bond issue under each of the following independent assumptions (FV of $1, PV of $1, FVA of $1, PVA of $1, FVAD of $1 and PVAD of $1) (Use appropriate factor(s) from the tables provided.): 1. Maturity 14 years, interest paid annually, stated rate 8%, effective (market) rate 10% 2. Maturity 10 years, interest paid semiannually, stated rate 8%, effective (market) rate 10% 3. Maturity 5 years, interest...
Each of the following scenarios is independent. Assume that all cash flows are after-tax cash flows. a. Campbell Manufacturing is considering the purchase of a new welding system. The cash benefits will be $480,000 per year. The system costs $2,700,000 and will last 10 years. b. Evee Cardenas is interested in investing in a women's specialty shop. The cost of the investment is $270,000. She estimates that the return from owning her own shop will be $52,500 per year. She...
Different cash flow. Given the following cash inflow, what is the present value of this cash flow at 3%, 13%, and 24% discount rates? Year 1 Year 2: Years 3 through 7: Year 8: $1,000 $6,000 SO $26,000 What is the present value of this cash flow at 3% discount rate? SL (Round to the nearest cent.) What is the present value of this cash flow at 13% discount rate? SL (Round to the nearest cent.) What is the present...
The Shallow Company has two bonds outstanding. Bond A was issued exactly 5 years ago at a coupon rate of 9%. Bond Z was issued exactly 1 year ago at a coupon rate of 8%. Both bonds were originally issued with semi-annual coupon payments, terms of 20 years, and face values of $1,000. The current yield to maturity (YTM) is 7.5% for both bonds. Which of the following statements is LEAST correct? The internal rate of return (IRR) on Bond...
QUESTION 26 (5 points) Asset A was purchased six months ago for $15,000 and has generaced $1,500 cash flow during that period. What is the asset's rate of return if it can be sold for $16,750 today? T T TT Arial 3(12pt)
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