12 | Alternative | PV | |
1 | 54000 | ||
2 | $20,000 + $8,000*PVAF(6%,6) =$20,000 + $8,000*4.91732 =$59,339 | ||
3 | $13,000*[PVAF(6%,5 years)+1] =$13,000*5.21236 =$67,761 | ||
Alex should choose 3rd option as the PV is highest in this option | |||
So Option C is answer | |||
13 | FV after 6 years | $6,975.32 | FV(6%,6,1000)*1.06 |
FV after 7 years | $6,975.32*1.06 =$7,393.84 | ||
So Option C is answer | |||
12. Alex Meir recently won a lottery and has the option of receiving one of the...
Alex Meir recently won a lottery and has the option of receiving one of the following three prizes: (1) $64,000 cash immediately, (2) $21,000 cash immediately and a six-period annuity of $7,700 beginning one year from today, or (3) a six-period annuity of $13,300 beginning one year from today. 1. Assuming an interest rate of 7%, determine the present value for the above options. Which option should Alex choose? 2. The Weimer Corporation wants to accumulate a sum of money...
Answer each of the following independent questions. Alex Meir recently won a lottery and has the option of receiving one of the following three prizes: (1) $80,000 cash immediately, (2) $29,000 cash immediately and a six-period annuity of $8,700 beginning one year from today, or (3) a six-period annuity of $16,200 beginning one year from today. (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...
Alex Meir recently won a lottery and has the option of receiving one of the following three prizes: (1) $70,000 cash immediately, (2) $24,000 cash immediately and a six-period annuity of $8,100 beginning one year from today, or (3) a six-period annuity of $14,500 beginning one year from today. (FV of $1, PV of $1, EVA of $1, PVA of $1, EVAD of $1 and PVAD of $1) (Use appropriate factor(s) from the tables provided.) 1. Assuming an interest rate...
Alex Meir recently won a lottery and has the option of receiving one of the following three prizes: (1) $98,000 cash immediately, (2) $40,000 cash immediately and a six-period annuity of $9,900 beginning one year from today, or (3) a six-period annuity of $19,800 beginning one year from today. (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. Assuming an interest rate...
Answer each of the following independent questions. Alex Meir recently won a lottery and has the option of receiving one of the following three prizes: (1) $64,000 cash immediately, (2) $20,000 cash immediately and a six-period annuity of $8,000 beginning one year from today, or (3) a six-period annuity of $13,000 beginning one year from today. (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...
Alex Meir recently won a lottery and has the option of receiving one of the following three prizes: (1) $64,000 cash immediately, (2) $21,000 cash immediately and a six-period annuity of $7,700 beginning one year from today, or (3) a six-period annuity of $13,300 beginning one year from today. (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. Assuming an interest rate of...
Answer each of the following independent questions. Alex Meir recently won a lottery and has the option of receiving one of the following three prizes: (1) $64,000 cash immediately. (2) $20,000 cash immediately and a six-period annuity of $8,000 beginning one year from today, or (3) a six-period annuity of $13,000 beginning one year from today. (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...
Answer each of the following independent questions. Alex Meir recently won a lottery and has the option of receiving one of the following three prizes: 1598.000 cash immediately. 12 $40.000 cash Immediately and a sbe period annuity of $9.900 beginning one year from today, or asbe-period annuity of $19.800 beginning one year from today. By el $1. PV of $1. EVA of $1. PVA $1. EVAD. Si and VAD $ (Use appropriate factor(s) from the tables provided.) 1. Assuming an...
Exercise 5-10 (Algo) Future and present value [LO5-3, 5-7, 5-8] Answer each of the following independent questions. Alex Meir recently won a lottery and has the option of receiving one of the following three prizes: (1) $68,000 cash immediately, (2) $23,000 cash immediately and a six-period annuity of $7,900 beginning one year from today, or (3) a six-period annuity of $13,700 beginning one year from today. (FV of $1, PV of $1, FVA of $1, PVA of $1, FVAD of $1 and...
Exercise 6-11 Future and present value [LO6-3, 6-6, 6-7] Answer each of the following independent questions Alex Meir recently won a lottery and has the option of receiving one of the following three prizes: (1) $82,000 cash immediately, (2) $30,000 cash immediately and a six-period annuity of $9,000 beginning one year from today, or (3) a six-period annuity of $17,000 beginning one year from today. (FV of $1, PV of $1, FVA of $1, PVA of $1. FVAD of $1...