What is the present value of a payment

Assignment Help Financial Management
Reference no: EM13850443

If the interest rate this year is 8.8% and the interest rate next year will be 10.8%, what is the future value of $1 after 2 years? What is the present value of a payment of $1 to be received in 2 years? (Do not round intermediate calculations. Round your answers to 4 decimal places.)

Future value      $  

Present value    $   

Reference no: EM13850443

Questions Cloud

Challenges faced by the american automobile industry : We are all unfortunately aware of the difficulties and challenges faced by the American automobile industry. From a position of national and international leadership, our Big Three (General Motors, Ford and Chrysler) of the American auto industry ..
Estimate the implied equity risk premium in market : The Bovespa (Brazilian Equity Index) is at 15,000. The dividends on the Index last year were 5% of the Index value. Analysts expect them to grow at 15% a year in real terms for next 5 years. After the 5th year, the growth is expected to drop to 5% in..
Coupon rate must bonds offer in order to sell at face value : General Matter’s outstanding bond issue has a coupon rate of 9.4%, and it sells at a yield to maturity of 7.80%. The firm wishes to issue additional bonds to the public at face value. What coupon rate must the new bonds offer in order to sell at face..
Arithmetic return for the stock : What is the arithmetic return for the stock? What is the geometric return for the stock?
What is the present value of a payment : If the interest rate this year is 8.8% and the interest rate next year will be 10.8%, what is the future value of $1 after 2 years? What is the present value of a payment of $1 to be received in 2 years?
Find the sample standard deviation : Find the sample standard deviation
Sustainable growth rate of earnings and dividends : Trust Bankers just paid an annual dividend of $1.9 per share. The expected dividend growth rate is 6.7 percent, the discount rate is 12 percent, and the dividends will last for 8 more years. What is the value of the stock? If the return on equity for..
Is blake mycoskie ethical in business : Is Blake Mycoskie ethical in business? Which level of moral development is he on? How may Blake Mycoskie's ethical and/or unethical behaviours have affected TOMS' corporate social responsibility
Explain the technique of computing trend ratio : What are the trend ratios? Explain the technique of computing trend ratio.

Reviews

Write a Review

Financial Management Questions & Answers

  Statements about medical coding

Which of the following statements about medical coding is incorrect?

  Draw a time line to show the cash flows of the project

Draw a time line to show the cash flows of the project and compute the project's payback period, net present value, profitability index, and internal rate of return.

  Complete the contract and pay them a lump sum settlement now

Three years ago, Sam purchased a farm on contract from an older lady for $149,000 at 7% interest over 15 years. The lady died unexpectedly and the heirs would like Sam to pay off the contract now, which has a current remaining balance of $130,000 wit..

  Investment opportunity-What is the NPV of the project

Lakonishok Equipment has an investment opportunity in Europe. The project costs €12 million and is expected to produce cash flows of €1.8 million in Year 1, €2.6 million in Year 2, and €3.5 million in Year 3. The current spot exchange rate is $1.36/€..

  Receive a credit card application

You receive a credit card application from Shady Banks Savings and Loan offering an introductory rate of 2.8 percent per year, compounded monthly for the first six months, increasing thereafter to 17 percent compounded monthly.

  Cost of capital for the valuation of the collinsville plant

The average unlevered beta of publicly traded Sodium Chlorate businesses is 0.94. Assume zero debt betas. The target capital structure that is appropriate for Collinsville plant is 35% debt and 65% equity. What is the appropriate cost of capital for ..

  Determines the finished goods inventory level

Which one of the following inventory management appraoches determines the finished goods inventory level and then works backward until the raw material needs are determined?

  What is the maximum number of new shares of common stock

Aspin Corporation’s charter authorizes issuance of 2,900,000 shares of common stock. Currently, 1,200,000 shares are outstanding, and 400,000 shares are being held as treasury stock. The firm wishes to raise $104,500,000 for a plant expansion.

  Calculate the amount of the firms after tax cash flow

Moby Dick Corporation has sales of $4,635,480 income tax of $400,651; the selling general and administrative expenses of $294,228; depreciation of $395,852; cost of goods of $2,543,550; and interest expense of $188,723. Calculate the amount of the fi..

  What is the current book value of this equipment

Western Wear purchased some 3-year MACRS property 3 years ago. What is the current book value of this equipment if the original cost was $48,000? The MACRS allowance percentages are as follows, commencing with year one: 33.33, 44.45, 14.81, and 7.41 ..

  Formal agreement-investment banks

Before entering a formal agreement, investment banks carefully investigate the companies whose securities they underwrite; this is especially true of the issues of firms going public for the first time.

  Interest is compounded continuously

How long will it take for $1400 to grow to $39,800 at an interest rate of 10.2% if the interest is compounded continuously? Round the number of years to the nearest hundredth.

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