Present and future values of a cash flow stream

Assignment Help Financial Management

Reference no: EM131027056

An investment will pay $100 at the end of each of the next 3 years, $250 at the end of Year 4, $300 at the end of Year 5, and $600 at the end of Year 6.

If other investments of equal risk earn 6% annually, what is its present value? Round your answer to the nearest cent.

If other investments of equal risk earn 6% annually, what is its future value? Round your answer to the nearest cent.

Reference no: EM131027056

Questions Cloud

Net present value of project given revised sales forecasts : Brewster’s is considering a project with a 5-year life and an initial cost of $120,000. The discount rate for the project is 12 percent. The firm is interested in knowing how the project will perform if the sales forecasts for Years 4 and 5 of the pr..

Bridge design firm is performing an economic analysis : A bridge design firm is performing an economic analysis of two mutually exclusive designs for a highway overpass. The steel girder option has an initial cost of $2.23 million, and the concrete option has an initial cost of $2.43 million. Based on the..

Maximum you should be willing to pay for this investment : An investment is expected to produce $2,281 at the end of each year for the next 13 years. Other investments of similar riskiness available to you are yielding 9.7 percent return. What is the maximum you should be willing to pay for this investment?

Annual rate of return on this sculpture : Assume a bronze sculpture sold in 2007 at auction for a price of $10,338,500. Unfortunately for the previous owner, he had purchased it in 1999 at a price of $12,386,500

Present and future values of a cash flow stream : An investment will pay $100 at the end of each of the next 3 years, $250 at the end of Year 4, $300 at the end of Year 5, and $600 at the end of Year 6.

Assuming they donot save any additional funds : Problem 5-3 Finding the required interest rate Your parents will retire in 26 years. They currently have $340,000, and they think they will need $2,500,000 at retirement. What annual interest rate must they earn to reach their goal, assuming they don..

The dividend yield and the capital gains yield : Suppose a stock had an initial price of $90 per share, paid a dividend of $2.40 per share during the year, and had an ending share price of $76. Compute the percentage total return. What was the dividend yield and the capital gains yield?

Expected net present value of this purchase opportunity : Stu can purchase a one-bedroom house near his college today for $110,000, including the cost of some minor repairs. He expects to be able to resell it in four years for $150,000 if he just puts a little effort into cleaning up the property. At a disc..

Identical deposit each year up to and including the year : Today is your birthday and you decide to start saving for college. You will begin college on your 18th birthday and will need $10,000 per year at the end of each of the next 4 years (after that 18th birthday - isn't it nice the college lets you pay a..

User Account

All Pages