Find out how much the endowment fund

Assignment Help Financial Management

Reference no: EM131577413

You want to start an endowment today that will pay for a finance lab at MSUB from next year. While next year the required amount for such a finance lab is $20,000, the amount will rise every year by 2% due to inflation. If the endowment is expected to make 6% annually, find out how much the endowment fund should be if you want to start it today. This is a growing perpetual cash flow problem.

Reference no: EM131577413

Questions Cloud

With debt and with taxes but no bankruptcy costs : You are considering a firm under three separate scenarios: (1) no debt, no taxes, and no bankruptcy costs; (2) with debt and with taxes but no bankruptcy costs;

What is future value : What is the future value of $1,650 in 17 years assuming an interest rate of 11.25 percent compounded semiannually?

The firm uses cumulative voting system : Miller's Hardware has 415,000 shares of stock outstanding with a current market value of $42 a share. The firm uses a cumulative voting system.

What is her portfolio beta : Shirley Paul's 2-stock portfolio has a total value of $100,000. What is her portfolio's beta?

Find out how much the endowment fund : find out how much the endowment fund should be if you want to start it today. This is a growing perpetual cash flow problem.

Estimate the value of two privately held companies : Suppose you have been asked to estimate the value of two privately held companies that don’t pay any dividends.

What is the present value of the annuity : What is the present value of the following annuity? $1,931 every half year at the beginning of the period for the next 12 years,

Explain how to use the corporate valuation model : Explain how to use the corporate valuation model to find the price per share of common equity.

Motives for hedger and speculator in the derivatives market : What are the primary motives for a hedger and a speculator in the derivatives market?

User Account

All Pages