Find the value today of a perpetuity that pays $33,000 per year for 8 years and then pays 4000 per year forever, with the 1st payment one year from today. The annual effective interest rate is 5.5%.
Find the value today of a perpetuity that pays $33,000 per year for 8 years and...
An annuity pays $500 per year for 8 years beginning one year from today. remaining value of the annuity immediately before the fourth $500 payment? Assume an interest rate of 2% APR. The correct answer is $2,403. However, I just don't know how to get to it.
An asset pays $20 today. It then pays $10 at the end of year one with payments decreasing by $1 per year until the end of year 10. It then pays a perpetuity with a payment of $15 at the end of year 11 with each subsequent payment growing by 3% annually. If the annual effective discount rate equals 6.5%, calculate the present value of the asset.
What is the value today of a 15-year annuity that pays $570 per year? The annuity’s first payment occurs six years from today. The annual interest rate is 11 percent for Years 1 through 5, and 13 percent thereafter.
1. What is the value today of receiving $2,422.00 per year forever? Assume the first payment is made next year and the discount rate is 12.00%. 2. What is the value today of receiving $1,429.00 per year forever? Assume the first payment is made 6.00 years from today and the discount rate is 4.00%. 3. If you are willing to pay $42,377.00 today to receive $4,353.00 per year forever then your required rate of return must be ____%. Assume the...
in 8 years you will begin receiving $167 per year in perpetuity from a family trust (first payment is exactly 8 years from today). you have decided to discount these cash flows at a constant interest rate of 6.3%. what is the present value today of these future cash flows?
An annuity pays $500 per year for 12 years beginning one year from today. What is the remaining value of the annuity immediately before the sixth $500 payment? Assume an interest rate of 2% APR. How would you do this with a financial calculator or excel? Thank you!
1. What is the present value of receiving $30 at the end of each year forever, starting 9 years from now? Assume an annual rate of interest of 7% 2. A perpetuity pays 1 at the beginning of every year. The present value is 10. Calculate the annual effective rate of interest earned by the perpetuity.
A perpetuity-due paying 5 every year has a present value of 90. An annuity-immediate paying 10 monthly for 5 years has the same effective rate of interest what is the present value of this annuity? Hint: To calculate the monthly annuity, you should find the present value of a 60 payment annuity using the monthly effective rate of interest that is equivalent to to the annual effective rate of interest that you derived from the perpetuity. That is find i...
-What is the future value of $1,200 a year for 40 years at 8 percent interest? Assume annual compounding. A. $301,115 B. $306,492 C. $310,868 D. $342,908 E. $347,267 -Karen is borrowing $17,800 to buy a car. The terms of the loan call for monthly payments for 5 years at 8.6 percent interest. What is the amount of each payment? A. $287.71 B. $291.40 C. $301.12 D. $342.76 E. $366.05 -Jonathan Corp. is evaluating a project with an initial cash...
An annuity pays $5000 each year for 5 years starting today. It pays $6000 per year for year 7 to year 10. The interest rate are 4% for the first 5 years and 8% for years 6 to 10. What is the present value of these cash flows?