A security makes monthly payment forever. The payment is growing at a constant rate of 0.5%. What should be the first monthly payment if it is sold at $2,000 and required rate of return is 4%?
A security makes monthly payment forever. The payment is growing at a constant rate of 0.5%....
A security makes monthly payment of $25 for 20 years. The monthly payment is expected to grow at 1%. what should be the return if it is sold at $3,800?
Compute the PV of a growing annuity with an initial monthly payment of $2,500, growing at 4% per year, a 35-year life and an annual discount rate of 6%. Select one: O a. $546,556.02 b. $847,917.43 c. $752,995.47 d. $332,778.24 e. $611,198.33
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...
A bond pays coupon payment of $100 per year and continue forever, required rate of return is 10% and the growth rate of cash flow is 5%. What’s the value of this bond? You should provide all the calculation process and formulas.
When calculating a growing perpetuity, the growth rate is expected to continue forever. Therefore it should not exceed... a. the growth rate of the population in the economy. b. the growth rate of productivity in the economy. c. the growth rate of the general economy (growth in real GDP). d. the return on a large portfolio of stocks from the economy. What is the present value of a growing perpetuity with an expected cash flow of 1,000 next year, a...
(b) GMX Ltd is a fast growing company. The company expects to grow at a rate of 20% in the first two years, and then by 11% for the next three years. Followed by this, the company is expected to settle to a constant growth rate of 4%. The first dividend is expected to be paid next year and will be equal to $4. What is the current price of this share, given that an investor's required rate of return...
The PV of a 8 annual-payment growing annuity is $89,719.63. The first payment of the growing annuity is $12,000 due one year from now. Subsequent annual payments are expected to grow at an annual rate identical to the effective annual interest rate. What is the annual growth rate?
A rich relative has bequeathed you a growing perpetuity. The first payment will occur in a year and will be $ 1,000. Each year after that, you will receive a payment on the anniversary of the last payment that is nbsp 7 % larger than the last payment. This pattern of payments will go on forever. Assume that the interest rate is 15 % per year. a. What is today's value of the bequest? (Round to the nearest cent.) b....
What is the value today of receiving $2,593.00 per year forever? Assume the first payment is made 8.00 years from today and the discount rate is 6.00%. Submit Answer format: Currency: Round to: 2 decimal places. unanswered not_submitted #4 If you are willing to pay $49,200.00 today to receive $4,333.00 per year forever then your required rate of return must be ____%. Assume the first payment is received one year from today. Submit Answer format: Percentage Round to: 2 decimal...
rich relative has bequeathed you a growing perpetuity. The first payment will occur in a year and will be $ 3 comma 000$3,000. Each year after that, you will receive a payment on the anniversary of the last payment that is nbsp 3 % 3% larger than the last payment. This pattern of payments will go on forever. Assume that the interest rate is 14 %14% per year. a. What is today's value of the bequest? b. What is the...