ZuoTi.Pro
Question

Investment X offers to pay you $3,902 per year for 9 years, whereas Investment Y offers...

Investment X offers to pay you $3,902 per year for 9 years, whereas Investment Y offers to pay you $5,199 per year for 6 years. What is the dollar difference (higher minus lower) in the present values of these two cash flow streams if the discount rate is 7.32 percent? Answer to two decimals.

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

Homework Answers

Answer #1

Present value of Investment X:-

=PV(rate,nper,pmt)

=PV(7.32%,9,3902)

=25079.95

Present value of Investment Y:-

=PV(7.32%,6,5199)

=24538.31

Difference in present value =25079.95-24538.31 =541.64

Where,

rate is rate of interest

nper is number of periods

pmt is annuity

0 0
Add a comment
Know the answer?
Add Answer to:
Investment X offers to pay you $3,902 per year for 9 years, whereas Investment Y offers...
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 ANSWER EVERYTHING ASAP THANK YOU!!! Investment X offers to pay you $3,728 per year for...

    PLEASE ANSWER EVERYTHING ASAP THANK YOU!!! Investment X offers to pay you $3,728 per year for 9 years, whereas Investment Y offers to pay you $4,690 per year for 5 years. What is the dollar difference (higher minus lower) in the present values of these two cash flow streams if the discount rate is 5.26 percent? Answer to two decimals. What are the annual cash flows (in $) of an annuity for 14 years, which costs $33,721 today, if the...

  • Investment X offers to pay you $3,700 per year for nine years

    PV Multiple CFs. Investment X offers to pay you $3,700 per year for nine years, whereas Investment Y offers to pay you $5,500 per year for five years. a) Which of these cash flow streams has the higher present value if the discount rate is 6 percent? b) If the discount rate is 22 percent?

  • Investment X offers to pay you $4,700 per year for eight years

    Investment X offers to pay you $4,700 per year for eight years, whereas Investment Y offers to pay you $6,700 per year for five years. Which of these cash flow streams has the higher present value if the discount rate is 5 percent? If the discount rate is 15 percent?  Complete the following analysis. Do not hard code values in your calculations. All answers should be positive. Value of X at 5% _______ Value of Y at 5% _______ Value of X at 15% _______ Value of...

  • Investment X offers to pay you $7,900 per year for 9 years, whereas Investment Y offers...

    Investment X offers to pay you $7,900 per year for 9 years, whereas Investment Y offers to pay you $10,800 per year for 5 years. a. If the discount rate is 8 percent, what is the present value of these cash flows? (Do not round intermediate calculations and round your answers to 2 decimal places, e.g., 32.16.) b. If the discount rate is 20 percent, what is the present value of these cash flows? (Do not round intermediate calculations and...

  • Present Value and Multiple Cash Flows [LO1] Investment X offers to pay you $4,200 per year...

    Present Value and Multiple Cash Flows [LO1] Investment X offers to pay you $4,200 per year for eight years, whereas Investment Y offers to pay you $6,100 per year for five years. Which of these cash flow streams has the higher present value if the discount rate is 5 percent? If the discount rate is 15 percent? Please do not use excel. Please type it.

  • Investment X offers to pay you $4,800 per year for nine years, whereas Investment Y offers...

    Investment X offers to pay you $4,800 per year for nine years, whereas Investment Y offers to pay you $6,900 per year for five years. Calculate the present value for Investments X and Y if the discount rate is 6 percent. (Do not round intermediate calculations and round your answers to 2 decimal places, e.g., 32.16.) Present value Investment X Investment Y Calculate the present value for Investments X and Y if the discount rate is 16 percent. (Do not...

  • Investment X offers to pay you $5,500 per year for nine years,whereas Investment Y offers...

    Investment X offers to pay you $5,500 per year for nine years, whereas Investment Y offers to pay you $8,000 per year for five years. a. Calculate the present value for Investments X and Y if the discount rate is 5 percent. (Do not round intermediate calculations and round your answers to 2 decimal places, e.g., 32.16.) b. Calculate the present value for Investments X and Y if the discount rate is 15 percent. (Do not round intermediate calculations and round your...

  • Investment X offers to pay you $4,900 per year for nine years, whereas Investment Y offers...

    Investment X offers to pay you $4,900 per year for nine years, whereas Investment Y offers to pay you $7,600 per year for five years.    a. Calculate the present value for Investments X and Y if the discount rate is 4 percent. (Do not round intermediate calculations and round your answers to 2 decimal places, e.g., 32.16.) b. Calculate the present value for Investments X and Y if the discount rate is 14 percent. (Do not round intermediate calculations...

  • Investment X offers to pay you $1629 per year for 14 years, whereas Investment Y offers...

    Investment X offers to pay you $1629 per year for 14 years, whereas Investment Y offers to pay you $7373 per year for 4 years. Both investments have a discount rate of 10.6%. Calculate the present value for Investment X.

  • 1. Investment X offers to pay you $3997 per year for 18 years, whereas Investment Y...

    1. Investment X offers to pay you $3997 per year for 18 years, whereas Investment Y offers to pay you $9988 per year for 5 years. Both investments have a discount rate of 5.0%. Calculate the present value for Investment X. 2. Investment X offers to pay you $1461 per year for 19 years, whereas Investment Y offers to pay you $6073 per year for 6 years. Both investments have a discount rate of 12.1%. Calculate the present value for...

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