Q5: For an annual benefit of $50,000, how many years does it take for this value to drop below $500 (1%) in present worth, given a discount rate of 10%? Repeat for 1% and 5% and 20%. Plot each curve (on the same graph) with annual benefit on the y-axis and time (years, 1-50) on the x-axis.
Q: a discount rate of 5%, a benefit of £1000 two years from now has a present value of £907. What would…
A: The discount rate is nothing but prevailing interest rate in the market and discounted value is…
Q: Present discounted values (I): Compute the present discounted value of thefollowing income streams.…
A: Hello. Since your question has multiple sub-parts, we will solve first three sub-parts for you. If…
Q: Given the table of values, solve for the Benefit Cost Ratio (round-off to 4 decimal places) at an…
A: The benefit-cost ratio (B/C ratio) is a kind of capital project evaluation technique that compares…
Q: An investment of P100,000 is expected to yield a regular annual net income of P25,000 per year for…
A: Calculation of benefit cost ratio are as follows
Q: If the arithmetic gradient is 1000$ and interest rate is 10% what the present sum of company after 5…
A: The arithmetic gradient is a special case of cash flow series, in the series cash will either…
Q: You purchased GameStock at $10 per share and exactly one year later you sold it fo $95. What is…
A: Effective Rate refers to actual return that an investment will yield considering compounding factor…
Q: Illustration: An investment opportunity costs $10,000 and returns $5,000, $4,000, and $3,000,…
A:
Q: Profit If changing market conditions cause acompany earning a profit of $8,000,000 this year…
A: Profit is referred as the total expenses subtracted from the revenue of the business. Profit is…
Q: Assume that Money Demand takes the form: -Y[1-(r+**)] where Y1,400 and r=0.2 Assume that, in the…
A: Money demand function is as…
Q: What is the present value of RM9,070 to be received 5 years from today if the discount rate is 16…
A: Using the PV function in excel
Q: 5. If the discount rate is 7%, then the present value of $40,000 that you expect to get after 15…
A: Data given is as follows: Future value after 15 years = $40000 Discount rate = 7% Time period = 15…
Q: What is the present value of RM4,500 to be received 10 years from today if the discount rate is 6…
A: Using PV function in excel
Q: Suppose you receive $10,000 and have an opportunity to earn a real rate of return of 10% (assume…
A: Perpetuity will be reflective of a stream of cash flows which will be provided forever. The present…
Q: If $476 invested today yields $500 in one year's time, what is the discount rate?
A: If $476 invested today yields $500 in one year's time, the discount rate can be calculated using…
Q: 10. Determine the present value now of an investment of OMR3,000 made one year from now and an…
A: The money's worth varies with time. Therefore, we consider the value of the money with time. Today's…
Q: Answer the following questions: TIME VALUE OF MONEY years. What is the investment's FV at rates of…
A: “Hi There, thanks for posting the question. But as per Q&A guidelines, we must answer the first…
Q: Given the following data, calculate the benefit cost ratio using an interest rate of 9% per year? To…
A: The benefit-cost ratio is used to find out the usefulness of a project as it measures the benefits…
Q: Present
A: Formula to calculate PV: PV = FV/(1+i)^n Where PV is the present value FV is the future value i is…
Q: 1. Assume that $1,000 is to be received 30 years from today. Compare the present values obtained…
A: The present value of a cash flow is the present value of a cash flow at a certain rate of interest…
Q: Approximately. what is the value of PG (present worth of arithmetic gradient) if G-85, n=18 years,…
A: Arithmetic Gradient is an equal amount which gets added to each subsequent annuity. It increases…
Q: What is the present value of RM27,000 perpetuinty per year discounted at 12%? Select one: a.…
A: In the given question we need to calculate the present value of perpetuity from following info.:…
Q: 3. If you receive $98 each month for 12 months and the discount rate is 0.07, what is the present…
A: In this Question we require to calculate the Present Value of Cash flows that we will receive every…
Q: present value of $280 paid one year from now is $250, what is the one-year discount factor?
A: Present Value = $280 = P.V To be paid after one year =$ 250 = P Let, Discount rate = r Then, P =…
Q: 5. In an investment, I have a full payback with an amount of P500,000.00 after 20.9123 years. If we…
A: 5. To calculate the number of times first we need to calculate the present value then, divide the…
Q: The present value of P 14,000.00 has a true discount of P 14,700.00 in 7 years. How much is the rate…
A: Future value of amount is computed as sum of present value and true discount.
Q: Solve the following problem using the present worth analysis for an interest rate of 8%. Alt. A Alt.…
A: Present worth is the present value of cashflow discounted at 8%
Q: Future Value You invest $1,000 today and exect to sell the investment for $2,000 in 10 years. a. Is…
A: We need to use the concept of time value of money to solve the question. According to the concept of…
Q: You have $76,000 in your account that you want to grow to triple that amount in 25 years. What…
A: Answer: Following information are given: Present value = $76,000 Time = 25 years Future value = 3…
Q: A company is expected to result 2900$ savings first year then increase by 200$ annually, if the rate…
A: Annual worth is the value of benefits and costs that would be incurred over a specific time period…
Q: 2. The following are exercises in present values: a. $100 at the end of three years is worth how…
A: We need to find the present values of the cashflows for part (a) to part (c). Let CFn be the…
Q: General price inflation is estimated to be 3% for the next 5 years, 5 % the 5 years after that, and…
A: Future Worth(FW) is value of current amount in future time calculated by compounding current amount.
Q: What is the value today of $1,600 per year, at a discount rate of 10 percent, if the first payment…
A: The present value of the annuity is the current worth of a cash flow series at a certain rate of…
Q: music studio predicts its future yearly net income (loss) to be as follows: Year 1: - $120 Year 2:…
A: NPV FORMULA: NPV=∑i=1nfuture cashflow1+ri where, n= number of years r=discount rate
Q: 1. If the interest rate is 8% per year, what decision would you make based on the decision tree…
A: Interest Rate = 8% Year Probability Cash Flows Probability Cash Flows 1 2…
Q: Net Income for Company A is $200,000 in 2014, $300,000 in 2015, $400,000 in 2016, $500,000 in 2017,…
A: The expected return is the minimum required rate of return which an investor required from the…
Q: Please show working Someone promises to pay you $1,000 in years 5, 10 and 15 for a total of $3,000.…
A: Duration of an annuity is simply the cashflow weighted average. it is calculated as follows D =…
Q: d. At what discount rate would the present value of 15 annual payments of $100, with the first…
A: Dear student, As specified in your question I have answered only Part d, e and f Part d
Q: What is the present value of $10,000 to be received at the end of 3 years if the discount rate is…
A: A concept that implies the future worth of the money is lower than its current value due to several…
Q: 4. If you receive $116 each month for 28 years and the discount rate is 0.08, what is the present…
A: This Question require to calculate the Present Value of Cash flows received every month for 28…
Q: 2. If you receive $99 each quarter for 17 years and the discount rate is 0.05, what is the future…
A: In this Question we require to calculate the Future Value of Cash flows that we will receive every…
Q: What would you be ready to spend now for a P1,250 annual return over the following ten years,…
A: The term "discount charge" refers to the interest rate levied by the Treasury Department on…
Trending now
This is a popular solution!
Step by step
Solved in 3 steps with 1 images
- What is the present value of payments that are: year 0: 5000, year1: 10000, year2: 12500, year3: 15000? Discount factor 11%.1. Ati= 10% per year and a loan amount of $10,000. If N = 20, what are the payments and future value? Solve this problem using %3! a. Excel b. FormulaUse present value tables to compute the present value of $450,000 to be paid in 10 years, with an interest rate of 10 percent. (Future Value of $1, Present Value of $1, Future Value Annuity of $1, Present Value Annuity of $1) (Use appropriate factor(s) from the tables provided. Round "Present Value" to nearest whole dollar amount.) Table Function: Future Value: Present Value: i= %
- 5. Solve the following two independent scenarios: A. How much must be invested now to receive $30,000 for 10 years if the first $30,000 is received one year from now and the rate is 8%? Future Value PV FV Tables Factor Present Value ? ? ? PLEASE NOTE: All FV Factors will be rounded to three decimal places (i.e. 1.234). All dollar amounts will be with "$" and commas as needed and rounded to whole dollars (i.e. $12,345). Using the appropriate EXCEL spreadsheet, the answer = ? PLEASE NOTE: The dollar amount will be with "$" and commas as needed and rounded to two decimal places (i.e. $12,345.67). B. Project A costs $5,000 and will generate annual after-tax net cash inflows of $1,800 for five years. What is the NPV using 8% as the discount rate? Future Value PV FV Tables Factor Net Present Value ? ? ? PLEASE NOTE: All FV Factors will be rounded to three decimal places (i.e. 1.234). All dollar amounts will be with "$" and commas as needed and rounded to whole dollars (i.e.…Calculate the annual benefits (A) If G = 200$, n = 5 years and i = 11%. Select one: a. 395$ O b. 385$ O c. 358$1. If you receive $29 each quarter for 19 years and the discount rate is 0.05, what is the present value? (show the process and can use financial calculator)
- What would you be ready to spend now for a P1,250 annual return over the following ten years, assuming a discount rate of 12%?A. P4,062.75B. P5,062.75C. P6,062.75D. P7,062.75E. None of the above.Approximately, what is the value of PG (present worth of arithmetic gradient) if G=185, n=7 years, and i= 7.5% per year?If the arithmetic gradient is 1000$ and interest rate is 10% what the present sum of company after 5 years. Select one: a. 6832$ O b. 6862$ O c. 6830$
- b1. F = Pert , which assumes continuous compounding, says that the Future value (F) of an amount (P) invested today at an annual rate (r), expressed as a decimal for the time (t), in years is given by the function. Thus if you invested $100 at the annual rate of 5 1/2% for 6 years and 3 months you would get back (at the end of the time), F = $100e(0.055)(6.25) = $100e(0.3438) = $100(1.4102) = $141.02. If you invest $15000 today, what amount does the formula say you will get back if you leave it for 5 years and 3 months in a savings account paying 4 1/2% annually?Assume that at the beginning of the year, you purchase an investment for $7,200 that pays $100 annual income. Also assume the investment's value has decreased to $6,800 by the end of the year. (a) What is the rate of return for this investment? (Input the amount as a positive value. Enter your answer as a percent rounded to 2 decimal places.) Rate of return % (b) Is the rate of return a positive or negative number? Positive O NegativeWhat is the present value of an investment that pays $190 at the end of year 1, $107 at the year of year 2, and $235 at the end of year 3 if this investment earns 5% annually? your answer should be to the nearest dollar. For example, if your answer is id=mce_marker50, then input as 150.