The interest rate is 1% What is the Pv of an asset that pays nothing for the next seven years and then it pays 1 forever after
The interest rate is 1% What is the Pv of an asset that pays nothing for...
Interest rate with annuity. What are you getting in terms of interest rate if you are willing to pay $10,000 today for an annual stream of payments of $2,000 for the next 10 years? The next 20 years? The next 50 years? Forever? What are you getting in terms of interest rate if you are willing to pay $10,000 today for an annual stream of payments of $2,000 for the next 10 years? % (Round to two decimal places.) What...
1. 18 pts] For this question, suppose the market interest rate is 4 percent, and round all answers to the nearest $1. a) What is the present discounted value of a perpetuity paying $100 per year, every year, with the first payment coming one year from today? b) What is the present discounted value of a perpetuity paying $100 per year, every year, with the first payment coming 6 years from today? c) What is the present discounted value of...
If the interest rate is 10%, what is the present value of a security that pays you $1,125 next year, $1210 the year after, and $1339 the year after that? Present value is ? (round your repsonse to the nearest penny)
what is the Present Value of an asset that pays the following cash flows, if you can invest them at a rate of return of 5%? Time Period Cash Flow 0 2 4 75 75 75 75 75 Note: this is an 'ordinary annuity', it is the default assumption for both Excel and your financial calculator. a) Identify the assumptions given in this problem Rate of Return # of years Annual Payment Future Value b) Solve this problem using the...
If the market interest rate is 5 percent, what is the present discounted value of a financial instrument that pays you $50 per year, forever, starting next year, with the exception of year 17. I.e. it pays you $50 every year except for the payment 17 years from today, which is zero.
If the interest rate is 10%, what is the present value of a security that pays you $1,100 next year. $1,220 the year after, and $1,332 the year after that? Present value is $ 2798.97. (Round your response to the nearest penny.)
If the interest rate is 10%, what is the present value of a security that pays you $1,100 next year, sl 220 the year after, and S1338 the year after that? Present value is S(Round your response to the nearest penny)
(1 point) Problem 9 - Annuities with "Off Payments" A perpetuity pays 8000 at the end of every 6 years forever. The nominal annual interest rate is 6% compounded monthly. The present value of this perpetuity is PV = ||
please show work, step by step. unsure of what formula to use. 14) An asset pays $1,000 at the end of every year for 10 years, which starts growing at a constant rate of 2% from the 11th year and last forever (so the payment at the end of the 11th year is $1,020, 12th year is $1,020"(1+2%)= $1,040.40. What is the price of the asset given an annual discount rate of 5%? A) $28,594.79 B) $27,571.60 C) $28,185.51 D)...
1. A bank pays a quoted annual (simple) interest rate of 8 percent. However, it pays interest (compounds) on a daily basis using a 365-day year. What is the effective annual rate of return? Show details of the EAR formula. 2. You have just taken out a 30-year mortgage on your new home for $120,000. This mortgage is to be repaid in 360 equal monthly installments. If the stated (simple) annual interest rate is 14.75 percent, what is the amount...