What is the current value of this investment

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Problems on Time Value and Bonds: show your work.

1) General Mills will receive $27,500 per year for the next 10 years as a payment for an equipment it invented. A 12 percent rate is applied. What is the current value of this investment?

2) If you have $1,000 and you plan to save it for 4 years with an interest rate of 10%, what is the future value of your savings?

3) How much would you have to invest today to receive $12,000 in 6 years at 12%?

4) The Western Sweepstakes has just informed you that you have won $1 million. The amount is to be paid out at the rate of $50,000 a year for the next 20 years. With a discount rate of 12 %, what is the present value for your winnings?

5) A 15-year bond pays 9% on face value of $1,000. If similar bonds are currently yielding 6%, what is the market value of bond?

Reference no: EM132029630

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