ZuoTi.Pro
Question

23. What is the present value of 48 annual payments of $3,769 each with the first...

23. What is the present value of 48 annual payments of $3,769 each with the first payment being received immediately? Assume you can invest money at 10% stated rate with semi-annual compounding.

business   finance   
0 0
Add a comment Improve this question Transcribed image text
Next > < Previous
Sort answers by oldest

Homework Answers

Answer #1

EAR = (1 + 0.10/2)2 - 1 = 10.25%

Calculating Present Value of Annuity Due,

Using TVM Calculation,

PV = BEG[FV = 0, PMT = 3,769, N = 48, I = 0.1025]

PV = $40,165.01

0 0
Add a comment
Know the answer?
Add Answer to:
23. What is the present value of 48 annual payments of $3,769 each with the first...
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Log In

Sign Up

Not the answer you're looking for? Ask your own homework help question. Our experts will answer your question WITHIN MINUTES for Free.
Similar Homework Help Questions

  • please show work!! John Keene recently invested $2,250 in a project that is promising to return 10 percent per yea...

    please show work!! John Keene recently invested $2,250 in a project that is promising to return 10 percent per year. The cash flows are expected to be as follows: WN Year End of Year Cash Flow $588 $553 $573 $?? $583 Note that the cash flow in year 4 is missing. Determine the Year 4 missing cash flow that will make the present value of this series equal to the amount John invested (that is, CFO = -2250)? Round your...

  • 9. Present value of annuities and annuity payments Aa Aa The present value of an annuity...

    9. Present value of annuities and annuity payments Aa Aa The present value of an annuity is the sum of the discounted value of all future cash flows. You have the opportunity to invest in several annuities. Which of the following 10-year annuities has the greatest present value (PV)? Assume that all annuities earn the same positive interest rate. O An annuity that pays $500 at the beginning of every six months O An annuity that pays $500 at the...

  • 7. Present value of annuities and annuity payments Aa Aa The present value of an annuity...

    7. Present value of annuities and annuity payments Aa Aa The present value of an annuity is the sum of the discounted value of all future cash flows. You have the opportunity to invest in several annuities. Which of the following 10-year annuities has the greatest present value (PV)? Assume that all annuities earn the same positive interest rate. An annuity that pays $1,000 at the end of each year An annuity that pays $1,000 at the beginning of each...

  • 12. Present value of annuities and annuity payments Aa Aa The present value of an annuity...

    12. Present value of annuities and annuity payments Aa Aa The present value of an annuity is the sum of the discounted value of all future cash flows. You have the opportunity to invest in several annuities. Which of the following 10-year annuities has the greatest present value (PV)? Assume that all annuities earn the same positive interest rate. O An annuity that pays $500 at the end of every six mońths O An annuity that pays $1,000 at the...

  • You will receive annual payments of $4,000 at the end of each year for ten years...

    You will receive annual payments of $4,000 at the end of each year for ten years (10 payments). The first payment will be received in year 3. What is the present value (t-0) of these payments if the discount rate is 9 percent.

  • 7. Present value of annuities and annuity payments The present value of an annuity is the...

    7. Present value of annuities and annuity payments The present value of an annuity is the sum of the discounted value of all future cash flows. You have the opportunity to invest in several annuities. Which of the following 10-year annuities has the greatest present value (PV)? Assume that all annuities earn the same positive interest rate. An annuity that pays $500 at the end of every six months An annuity that pays $1,000 at the end of each year...

  • 1. Complete the following table. Number of Annual Payments or Years Present Value Interest Rate Future...

    1. Complete the following table. Number of Annual Payments or Years Present Value Interest Rate Future Value Annuity 10 $250.00 12% 20 S1,000 25 S500,000 30 S1,000,000 2. You just started working and you planned to save $5,000 every year in your retirement account. How much money will you have in your retirement account once you retire in 40 years? Your retirement account pays 4% interest rate per year. 3. You just retired with S1,000,000 savings. You'd like to receive...

  • a) What is the present value of $40 earned 2-years from now if compounding was semi-annual...

    a) What is the present value of $40 earned 2-years from now if compounding was semi-annual and the interest rate is annually 3%? b) A “black box” just paid $20, which is expected to grow by 3% when the interest rate is 7% forever, what is the present value of this “black box”? c) What is the future value of an annuity due with a $15 cash flow, 4% annual interest with quarterly compounding three-years from now? d) If the...

  • What is the present value of a series of annuity payments of $7,000 each for 12...

    What is the present value of a series of annuity payments of $7,000 each for 12 years made annually with an annual discount rate of 5% with the first payment starting today?

  • A series of 16 equal semi-annual payments of $ 2,000 each are made for 8 years....

    A series of 16 equal semi-annual payments of $ 2,000 each are made for 8 years. What would be the future value of this series of payments, immediately after the last semi-annual payment of $ 2,000 ? The annual interest rate is 8 % compounded continuously.

ADVERTISEMENT
Free Homework Help App
Download From Google Play
Scan Your Homework
to Get Instant Free Answers
Need Online Homework Help?
Ask a Question
Get Answers For Free
Most questions answered within 3 hours.
ADVERTISEMENT
ADVERTISEMENT
ADVERTISEMENT