To assess the value of the firm stock

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Reference no: EM131828943

Imprudential, Inc., has an unfunded pension liability of $755 million that must be paid in 25 years. To assess the value of the firm’s stock, financial analysts want to discount this liability back to the present.

If the relevant discount rate is 8 percent, what is the present value of this liability? (Enter your answer in dollars, not millions of dollars, e.g., 1,234,567. Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.)

Present value $

Suppose you are committed to owning a $205,000 Ferrari.

If you believe your mutual fund can achieve an annual return of 10.7 percent, and you want to buy the car in 12 years on the day you turn 30, how much must you invest today? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.)

Amount to be invested $

Reference no: EM131828943

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