What is present value of the car payments

Assignment Help Financial Management
Reference no: EM131460342

A car dealership offers you no money down on a new car. You may pay for the car for 5 years by equal monthly end-of-the-month payments of $451 each, with the first payment to be made one month from today. If the discount annual rate is 18.53 percent compounded monthly, what is the present value of the car payments? Round the answer to two decimal places.

Reference no: EM131460342

Questions Cloud

Reimburse carmelita and debbie for their moving expenses : Kevin McDilly is a sole proprietor running a used-car lot with two employees. Kevin agreed to reimburse Carmelita and Debbie for their moving expenses.
Which are more relevant the book or market value weights : Dinklage Corp. has 9 million shares of common stock outstanding. Which are more relevant, the book or market value weights?
Should we always use the WACC as the discount rate : Should we always use the WACC as the discount rate? If not, when shouldn’t we? When should we?
What are portfolio weights of each stock : what are the portfolio weights of each stock?
What is present value of the car payments : A car dealership offers you no money down on a new car. what is the present value of the car payments?
Potential approach to maximizing inventory turnover : Do you have any concerns regarding the background of the new COO’s background, or questions regarding his potential approach to maximizing inventory turnover?
Determining the taxable income : What amount of the rental losses may Smith deduct in determining taxable income?
Determine which one of three portfolios dominates another : Determine which one of these three portfolios dominates another.
What does asset liablity management role for banks : What does asset liablity management role for banks? and for pension funds?

Reviews

Write a Review

Financial Management Questions & Answers

  What is the cost of new stock with market price

What is the cost of new stock with a market price of $28, with last year’s dividends at $1.30, expecting to grow at an annual rate of 7% forever and float costs of 6% of market price?

  What is the present value of this growing perpetuity

You are evaluating a growing perpetuity product from a large financial services firm. The product promises an initial payment of $23,000 at the end of this year and subsequent payments that will thereafter grow at a rate of 0.03 annually. If you use ..

  The YTM on a bond is the interest rate

The YTM on a bond is the interest rate you earn on your investment if interest rates don’t change. If you actually sell the bond before it matures, your realized return is known as the holding period yield (HPY). Two years from now, the YTM on your b..

  What would be the projected share price

Consider Company X with an estimated 20% growth rate in earnings, a P/E multiple of 40, projected earnings at the end of this year of $2.50/share and projected dividends of $1/sh. What would be the projected share price for Company X at the end of th..

  Apply accounting equation and evaluate business operations

Apply the accounting equation; evaluate business operations.- Develop the ability to use the financial statements of actual companies.

  What is value of firm under each of two proposed plans

Gael Corporation is comparing two different capital structures, an all-equity plan (Plan I) and a levered plan (Plan II). Under Plan I, the company would have 185,000 shares of stock outstanding. Under Plan II, there would be 135,000 shares of stock ..

  What is your bonds rate of return over the year

You buy a(n) 6% coupon, 10-year maturity bond for $955. A year later, the bond price is $1,080. Assume coupons are paid once a year and the face value is $1,000. What is the new yield to maturity on the bond. What is your bond's rate of return over t..

  Project has negative net present value

Assume that a project has a negative net present value of $500 and an internal rate or return of 10%. Is the discount rate used to alculate the NPV higher than, lower than, or equla to 10%? Compare and contrast these two techniques, using this exampl..

  Chicken-plucking machine economically worthless

High electricity costs have made Farmer Corporation’s chicken-plucking machine economically worthless. Only two machines are available to replace it. The International Plucking Machine (IPM) model is available only on a lease basis. How much debt is ..

  Determine swaption payoff at expiration

Which of the following is not required to determine a swaption payoff at expiration?

  What is the amount of the expected disbursements

Weisbro and Sons purchase their inventory one quarter prior to the quarter of sale. The purchase price is 60 percent of the sales price. The accounts payable period is 60 days. The accounts payable balance at the beginning of quarter one is $25,400. ..

  What is the equity multiplier

Isolation Company has a debt–equity ratio of 0.4. Return on assets is 8 percent, and total equity is $453875. What is the equity multiplier?

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd