Find the present value-annual discount interest rate

Assignment Help Financial Management

Reference no: EM13814587

Find the present value of $7,000 to be received one year from now assuming a 3 percent annual discount interest rate. Also calculate the present value if the $7,000 is received after two years.

Reference no: EM13814587

Questions Cloud

Expected return on well-diversified portfolio : Suppose you are working with two factor portfolios, portfolio 1 and portfolio2. The portfolios hace expected returns of 12% and 9%, respectively. Based on this information, what would be the expected return on well-diversified portfolio A, if A has a..

Common stock valuation : Abercrombie & Fitch's common stock pays a dividend of $0.70. It is currently selling for $34.14. If the firm's investors require a return of 10 percent on their investment from buying Abercrombie & Fitch stock, what growth would Abercrombie & Fitch h..

The efficient market hypothesis holds : Which of the following statements are true if the efficient market hypothesis holds?

Indicative of a flexible short-term financial policy : Which one of the following is most indicative of a flexible short-term financial policy?

Find the present value-annual discount interest rate : Find the present value of $7,000 to be received one year from now assuming a 3 percent annual discount interest rate. Also calculate the present value if the $7,000 is received after two years.

Investments future value in terms of purchasing power : You are planning to invest $2,500 today for three years at a nominal interest rate of 9 percent with annual compounding. Now assume that inflation is expected to be 3 percent per year over the same three-year period. What would be the investment's fu..

What is the maximum initial cost : Scanlin, Inc., is considering a project that will result in initial after tax cash savings of $1.76 million at the end of the first year, and these savings will grow at a rate of 3 percent per year indefinitely. The cost-saving proposal is somewhat r..

Accounting break-even quantity-cash break-even quantity : Consider a project with the following data: accounting break-even quantity = 19,000 units; cash break-even quantity = 16,000 units; life = three years; fixed costs = $160,000; variable costs = $30 per unit; required return = 10 percent. Ignoring the ..

What is difference between the expected return on equity : Southwest physicians a medical group practice in Oklahoma City are just being formed. it will need $2 million of total assets to generate $3 million in revenues. Furthermore the group expects to have a total margin of 5 percent. The group is consider..

User Account

All Pages