Compounding and discounting cash flows

Assignment Help Financial Management
Reference no: EM131064004

Compounding and Discounting cash flows. Your employer promises you a bonus of $10,000 in 3 years. If your discount rate is 6%; what is the present value of this bonus?

Reference no: EM131064004

Questions Cloud

Issuance of the bonds by comenius corporation : On August 1, 2016 Comenius Corporation issued $10 million of 8% bonds at a price of 105. The bonds mature in 20 years. Each bond was issued with 20 detachable stock warrants, each of which entitled the bondholder to purchase, for $50, one share of Co..
A for profit dialysis centers last dividend : A for profit dialysis centers last dividend was $1.50. The current equilibrium price for its stock is $15.75 and it is expected to grow at a constant rate of 5%. If the stockholders required rate of return is 15%, what is expected yield and expected ..
Bank certificate of deposit : In your Freshman year your uncle deposits $10,000 into a 4-year bank certificate of deposit (CD) that pays 5% annual interest. You will receive the money in the account (including the accumulated interest) if you graduate with honors. How much will t..
Why has southwests business model and strategies : Why has Southwest's business model and strategies changed over time - in what ways is Southwest trying to improve its competitive advantage in 2011?
Compounding and discounting cash flows : Compounding and Discounting cash flows. Your employer promises you a bonus of $10,000 in 3 years. If your discount rate is 6%; what is the present value of this bonus?
Assignment - essay on an issue in lst : LING337: Assignment. Assignment - Essay on an issue in LST. The use of visuals in EITHER pedagogic science OR popular science OR professional science
What is the worth of expected cash flow stream today : You expect to receive $85,000 in net cash payments at the end of each year for the next 7 years.  Draw timeline of receipts with an opportunity cost of 6.5%. What is the worth of expected cash flow stream today?
Which payer and what type of change in volumes : Which payer and what type of change in volumes?
Define the nature of probability distributions : Define the nature of probability distributions and the two types associated with them? Discuss the importance of an investment advisor being able to explain to his or her client why a mutual fund characterized by a very low standard deviation could b..

Reviews

Write a Review

Financial Management Questions & Answers

  Expansion project-requires initial fixed asset investment

Quad Enterprises is considering a new three-year expansion project that requires an initial fixed asset investment of $2.58 million. The fixed asset falls into the three-year MACRS class. The project is estimated to generate $2,040,000 in annual sale..

  The bonds make semi annual payments

Night Hawk Co. issued 16-year bonds two years ago at a coupon rate of 9.0 percent. The bonds make semi annual payments. Required: If these bonds currently sell for 114 percent of par value, what is the YTM?

  What is the dollar amount of each payment jan receive

Jan sold her house on December 31 and took a $10,000 mortgage as part of the payment. The 10-year mortgage has a 10% nominal interest rate, but it calls for semiannual payments beginning next June 30. What is the dollar amount of each payment Jan rec..

  Using economic order quantity model in placing the orders

Cheesburger and Taco Company purchases 6,441 boxes of cheese each year. It costs $27 to place and ship each order and $9.92 per year for each box held as inventory. The company is using Economic Order Quantity model in placing the orders.

  What is the rate of return on the stock

Investors expect the market rate of return this year to be 12%. A stock with a beta of 2.0 has an expected rate of return of 21%. If the market return this year turns out to be 8%, what is the rate of return on the stock?

  Use for debt when calculating the cost of capital

Bennington Industrial Machines issued 142,000 zero coupon bonds seven years ago. The bonds originally had 30 years to maturity with a yield to maturity of 7.2 percent. Interest rates have recently increased, and the bonds now have a yield to maturity..

  What market share at the increased retail price

Crest brand of toothpaste by P&G is the #1 brand in a competitive and crowded toothpaste market in the USA. Crest enjoys 30% market share but the competition is on the increase and there is an ever increasing pressure on margins and profitability. Wh..

  Cost of capital equal to the expected return on the market

cost of capital equal to the expected return on the market which is 12%. project Used books 0.85 Beta 12% expected return. if the projects are mutually exclusive, which one would be accept.

  Different possible spot rates at option maturity

Consider a PUT option on euros with a strike price of $1.05/€ and an option premium of 8 cents per euro. Calculate the profit (net of the cost of the option) to the holder of the option for the following different possible spot rates at option maturi..

  What is the incremental profit- project profitability

Schweser Satellites Inc. produces satellite earth stations that sell for $99,100.00 each. The firm's fixed costs, F, are $1.60 million, 65 earth stations are produced and sold each year, profits total $394,000.00; and the firm's assets (all equity fi..

  Discuss the differences between eurocurrency eurobonds

Discuss the differences between Eurocurrency, Eurobonds, and Eurocredits.

  Explain the benefit-based principle in taxation

Explain the benefit-based principle in taxation. Also explain how this principle is linked to the Lindhal equilibrium in local public finance choice

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd