The present value of an investment be the highest

Reference no: EM131015816

QUESTION 1: Under which of the following discounting methods will the present value of an investment be the highest, assuming the same annual interest rate?

Yearly

Quarterly

Monthly

Semi-annually

Which one is correct???

QUESTION 2: If you can invest $200,000 at a 10.5% annual rate, compounded monthly, how long will it take to have $500,000? (Do not your intermediate calculations. Round your final answer to the nearest whole month.)

119 months

105 months

109 months

160 months

Yearly

Which one is correct???

QUESTION 3: You are starting college this month, and your favorite aunt has agreed to give you $4,000 at the end of each of your four years and you can save $8,000 at the end of each year for the first two years after you graduate. If all of these amounts are invested at 14%, how much will you have to start graduate school, six years from now? (Round the final answer to the nearest dollar.)

$42,927

$42,167

$42,160

$42,702

Which one is correct???

QUESTION 4: Cavincare has 50 years remaining on a service contract with Martin, Inc. Today, Martin paid $120,000 for services received last year and the annual payment increases by 2.5% each year. The firm's required rate of return is 15%. What is the value of the contract to Cavincare? (Do not round intermediate calculations. Round the final answer to the nearest whole dollar amount.)

$915,000

$974,634

$987,131

$980,879

Which one is correct??????

Reference no: EM131015816

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