Future and present value of an annuity due

Assignment Help Financial Management

Reference no: EM131061280

Future and Present Value of an Annuity Due (LG6)

If you start making $130 monthly contributions today and continue them for five years, what’s their future value if the compounding rate is 9.25 percent APR? (Do not round intermediate calculations and round your final answer to 2 decimal places.)

Future value annuity $

What is the present value of this annuity? (Do not round intermediate calculations and round your final answer to 2 decimal places.)

Present value annuity $

I got Futrue value annuity as 9869.75

=130*((1+(9.25%/12))^(5*12)-1)/(9.25%/12)

and Present valus annuity as 6226.08

=130*(1-(1/(1+(9.25%/12))^(5*12)))/(9.25%/12)

Reference no: EM131061280

Questions Cloud

Calculating the bond price : Consider a bond which pays 8% semiannually and has 8 years to maturity. The market requires an interest rate of 10% on bonds of this risk. What is this bond's price?

What is the coupon rate on bond : Moonbeam, Inc. has a bond issue outstanding with a face value of $1,000 trading at $988.52. It makes a semiannual coupon payment, has a YTM of 6.31%, and will mature in 8.56 years. What is the coupon rate on this bond?

Difference between the two materials : If the scatter in the individual samples of the previous problem is reduced to that listed below, would there be a justification (0.95 probability level) for saying there was a difference between the two materials? (Note that mean values of the tw..

Current state of the art of an emerging knowledge domain : MN502: Network Security Assignment. The purpose of this assignment is to develop skills to independently think of innovation. In this assignment students will first learn how to develop knowledge based on current state of the art of an emerging kn..

Future and present value of an annuity due : If you start making $130 monthly contributions today and continue them for five years, what’s their future value if the compounding rate is 9.25 percent APR? What is the present value of this annuity?

Computing the risk premiums on bonds : Why are risk premiums on bonds a useful way of ranking risks for direct investments, but not very useful for making bond purchasing decisions?

Expectations theory and the liquidity premium theory : 1. Interpret the following statement made by Wall Street analysts and portfolio managers: "Although yields among bonds are related, today's rumors of a tax cut caused an increase in the yield on municipal bonds, while the yield on corporate bonds ..

Bond issue outstanding with an annual coupon : Potter Industries has a bond issue outstanding with an annual coupon of 6% and a 10-year maturity. The par value of the bond is $1,000. If the going annual interest rate is 8.8%, what is the value of the bond?

Required rate of return : Assume that the risk-free rate is 6.5% and the expected return on the market is 10%. What is the required rate of return on a stock with a beta of 2.3?

User Account

All Pages