5.
If you put up $52,000 today in exchange for a 6.50 percent, 16-year annuity, what will the annual cash flow be? (Do not round intermediate calculations and round your final answer to 2 decimal places. (e.g., 32.16))
Annual cash flow
$
6.
Investment X offers to pay you $4,900 per year for nine years, whereas Investment Y offers to pay you $7,000 per year for six years.
Calculate the present value for Investment X and Y if the discount rate is 4 percent. (Do not round intermediate calculations and round your final answers to 2 decimal places. (e.g., 32.16))
Present value
Investment X
$
Investment Y
$
Calculate the present value for Investment X and Y if the discount rate is 14 percent. (Do not round intermediate calculations and round your final answers to 2 decimal places. (e.g., 32.16))
Present value
Investment X
$
Investment Y
$
7.
An investment offers $5,400 per year for 10 years, with the first payment occurring one year from now.
If the required return is 5 percent, what is the value of the investment? (Do not round intermediate calculations and round your final answer to 2 decimal places. (e.g., 32.16))
Present value
$
What would the value be if the payments occurred for 35 years? (Do not round intermediate calculations and round your final answer to 2 decimal places. (e.g., 32.16))
Present value
$
What would the value be if the payments occurred for 65 years? (Do not round intermediate calculations and round your final answer to 2 decimal places. (e.g., 32.16))
Present value
$
What would the value be if the payments occurred forever? (Do not round intermediate calculations and round your final answer to 2 decimal places. (e.g., 32.16))
5.
| If you put up $52,000 today in exchange for a 6.50 percent, 16-year annuity, what will the annual cash flow be? (Do not round intermediate calculations and round your final answer to 2 decimal places. (e.g., 32.16)) |
| Annual cash flow | $ |
6.
| Investment X offers to pay you $4,900 per year for nine years, whereas Investment Y offers to pay you $7,000 per year for six years. |
| Calculate the present value for Investment X and Y if the discount rate is 4 percent. (Do not round intermediate calculations and round your final answers to 2 decimal places. (e.g., 32.16)) |
| Present value | |
| Investment X | $ |
| Investment Y | $ |
| Calculate the present value for Investment X and Y if the discount rate is 14 percent. (Do not round intermediate calculations and round your final answers to 2 decimal places. (e.g., 32.16)) |
| Present value | |
| Investment X | $ |
| Investment Y | $ |
7.
| An investment offers $5,400 per year for 10 years, with the first payment occurring one year from now. |
|
|
| If the required return is 5 percent, what is the value of the investment? (Do not round intermediate calculations and round your final answer to 2 decimal places. (e.g., 32.16)) |
| Present value | $ |
| What would the value be if the payments occurred for 35 years? (Do not round intermediate calculations and round your final answer to 2 decimal places. (e.g., 32.16)) |
| Present value | $ |
| What would the value be if the payments occurred for 65 years? (Do not round intermediate calculations and round your final answer to 2 decimal places. (e.g., 32.16)) |
| Present value | $ |
| What would the value be if the payments occurred forever? (Do not round intermediate calculations and round your final answer to 2 decimal places. (e.g., 32.16)) |
Related questions
| Investment X offers to pay you $4,600 per year for nine years, whereas Investment Y offers to pay you $6,700 per year for six years. |
| Calculate the present value for Investment X and Y if the discount rate is 4 percent. (Do not round intermediate calculations and round your final answers to 2 decimal places. (e.g., 32.16)) |
| Present value | |
| Investment X | $ |
| Investment Y | $ |
| Calculate the present value for Investment X and Y if the discount rate is 14 percent. (Do not round intermediate calculations and round your final answers to 2 decimal places. (e.g., 32.16)) |
| Present value | |
| Investment X | $ |
| Investment Y | $ |
| 1. You want to be a millionaire when you retire in 35 years. |
| How much do you have to save each month if you can earn an 11.5 percent annual return? (Do not round intermediate calculations and round your final answer to 2 decimal places. (e.g., 32.16)) |
| Savings per month | $ |
| How much do you have to save each month if you wait 15 years before you begin your deposits? (Do not round intermediate calculations and round your final answer to 2 decimal places. (e.g., 32.16)) |
| Savings per month | $ |
| How much do you have to save each month if you wait 25 years before you begin your deposits? (Do not round intermediate calculations and round your final answer to 2 decimal places. (e.g., 32.16)) |
| Savings per month | $ |
2.
| Toadies, Inc., has identified an investment project with the following cash flows. |
| Year | Cash Flow | |||||
| 1 | $ | 1,575 | ||||
| 2 | 1,695 | |||||
| 3 | 1,780 | |||||
| 4 | 1,830 | |||||
| If the discount rate is 7 percent, what is the future value of the cash flows in year 4? (Do not round intermediate calculations and round your final answer to 2 decimal places. (e.g., 32.16)) |
| Future value | $ |
| If the discount rate is 12 percent, what is the future value of the cash flows in year 4? (Do not round intermediate calculations and round your final answer to 2 decimal places. (e.g., 32.16)) |
| Future value | $ |
| If the discount rate is 23 percent, what is the future value of the cash flows in year 4? (Do not round intermediate calculations and round your final answer to 2 decimal places. (e.g., 32.16)) |
| Future value | $ |
|
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