What is the future value in three years of the present value

Assignment Help HR Management

Reference no: EM131472956

Suppose you receive $100 at the end of each year for the next three years.

a. If the interest rate is 8%, what is the present value of these cash flows?

b. What is the future value in three years of the present value you computed in (a)?

c. Suppose you deposit the cash flows in a bank account that pays 8% interest per year. What is the balance in the account at the end of each of the next three years (after your deposit is made)? How does the final bank balance compare with your answer in (b)?

Reference no: EM131472956

Questions Cloud

Should mutual fund managers be classified as fiduciaries : Are broker-dealers fiduciaries, and if so, what specific duties must they perform?

What is soft dollar brokerage : What is soft dollar brokerage, and why does it present a potential breach of fiduciary duties?

How would they go about identifying these factors : What compensable factors do you feel each of these employers would use to evaluate jobs? How would they go about identifying these factors?

Ompare and contrast historic approach to scenario approach : How does the status of the secular market (bull or bear) affect the difficulty of implementing a TAA strategy?

What is the future value in three years of the present value : If the interest rate is 8%, what is the present value of these cash flows? What is the future value in three years of the present value you computed in (a)?

Describe the risk premium approach : Describe how the risk premium approach provides perspective on the relative attractiveness of asset classes.

Common size balance sheet and income statement : Assume in 2007 you invested 10 million in each company, if you made no real dividend every year and you had 10% ,20% , 30% cost of capital in a 10 year horizon.

Describe the normal distribution : Adopting Markowitz's assumptions means that investors either have quadratic utility or believe all investments follow a normal distribution.

Human resources for big bison resorts : Frank Schuman, vice president of human resources for Big Bison Resorts, heard laughter as he approached the chief executive’s office door.

User Account

All Pages