Company will last forever for valuing the opportunity

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Reference no: EM131968050

1. You deposit $5,000 starting today (your 20th birthday) and continue to do so until your 50th birthday. The account pays 12% compounded daily. How much could you withdraw starting your 51st birthday until your 70th birthday? Assume the interest rate is compounded daily until your 70th birthday.

2. Your godmother deposit $3,000 each year on your birthday, starting the day you are born, in an account that pays 4.5 interest compounded quarterly. How much will you have in the account on your 25 th birthday, just after your godmother make her deposit?

3. A company generates $92,429.00 in cash flow per year. If investors want a 9.00% annual return to buy the company, how much are they willing to pay? Let’s assume the company will last forever for valuing the opportunity.

Reference no: EM131968050

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