What is the present value of the cash flows

Assignment Help Finance Basics
Reference no: EM131939910

Question: Assuming you will receive the cash flows listed below at the corresponding periods, assume a 5% rate.

Period: Cash Flow

0 - Now: 200

1: 600

2: 500

3: 100

4: 400

a) What is the present value of these cash flows?

b) What is the future value of these cash flows at year 4 (or when you get the last 200 cash flow)?

Reference no: EM131939910

Questions Cloud

Does kronos need to make payments : To attract world-class post-docs, Kronos Labs wants to establish a research fund that will provide $25,000/year for 15 years beginning at some future date.
Option sensitivities measures the change in the price : Which of the following option sensitivities measures the change in the price of the option with respect to a decrease in the time to expiration?
The greater the dividend paid by stock : All else being equal, the greater the dividend paid by a stock the:
Which projects do you accept and reject : Atlantic Engineering Incorporation is considering the following Project options. Given are the cash flows of the four projects, A, B, C, and D.
What is the present value of the cash flows : What is the present value of these cash flows? What is the future value of these cash flows at year 4 (or when you get the last 200 cash flow)?
How does given problem change the firm equity beta : Firm Xanc has a market beta for their equity of 1.2 and currently has a D/E ratio of 1.4. If you consider changing the D/E ratio to 1.6.
Find what is the maximum price you should be willing to pay : Assume that you wish to purchase a 20 year bond that has a maturity value of 1,000 and makes semiannual interest payments of $40. If you require a 10 percent.
Compute what is the effective yield to maturity : Assume a zero-coupon bond that sells for 5444 will mature in 10 years at $1, 150. Use Appendix B for an approximate answer but calculate your final answer.
Which alternative should you take and why : Assume that you just won the state lottery. Your prize can be taken either in the form of $35,000 a year received at the end of the next 25 years.

Reviews

Write a Review

Finance Basics Questions & Answers

  Approach versus the other

One of the key issues in valuation is whether to value just the equity portion of a firm or to value the entire enterprise. What are the arguments on both sides of this issue. Again, discuss what types of companies/situations might be best suited ..

  How can a company mitigate the impact of ethnocentrism

What is the impact of ethnocentrism on companies that want to expand their operations to new markets. Illustrate your answer with real-world examples. How can a company mitigate the impact of ethnocentrism. Provide suggestions and give examples to ..

  Financial options and weighted average cost of capital

Determine two to three (2-3) methods of using stocks and options to create a risk-free hedge portfolio can be created. Support your answer with examples of these methods being used to create a risk-free hedge portfolio.

  Current ratio and asset turnover ratio

A company's current ratio is 3.0. If the company uses cash to retire notes payable due within one year, would this transaction increase or decrease the current ratio and asset turnover ratio?

  Advantage of the agency relationship

Why is an increase in dividends considered evidence that a firm's managers are not taking advantage of the agency relationship?

  Important issue in maintaining managed care

"Maintenance of the professional relationship with physicians in the network recently has assumed a far greater role in in the industry's history."

  Determine the amortization schedule

Consider a 10-year, fixed-rate mortgage of $500,000 that has an interest rate of 12 percent. For simplification assume that payments are made annually.

  Find the value of the call

This call has two periods to go before expiring.Its stock price is 30, and its exercise price is 25. The risk-freerate is 0.05, the value of u is 1.15, and the value of d is 0.90.The stock pays a dividend at the end of the first period at therate ..

  International financial markets

Worcester Tool Company is a large, U.S.-based, multinational corporation with subsidiaries in eight different countries.

  What is the project payback period

An investment project provides case inflow of $690 per year for eight years. What is the project payback period if the initial cost is

  What rate of return is built into the annuity

You just won the state lottery. The state gives you the choice of $1,000,000 today or a 20-year annuity of $75,000, with the first payment coming one year from today. What rate of return is built into the annuity?

  The final paper will involve applying the concepts learned

evaluation of corporate performancethe final paper will involve applying the concepts learned in class to an analysis

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