What is the value of this endowment in todays dollars

Assignment Help Financial Management

Reference no: EM131044373

A wealthy philanthropist has established the following endowment for a hospital. The details are as follows: a cash deposit of $ 12 M two years from now; an annual cash deposit of $4M per year for the next five years. The first $4M will start today; at the end of 5 years, the hospital will also receive a lump sum payment of $15M. Assuming the cost of money is 4.5%, what is the value of this endowment in today’s dollars? Show your work.

Reference no: EM131044373

Questions Cloud

What is the firms gain or loss at sales-break-even point : The weaver watch company sells watches for $25, fixed costs are $140,000, and variable costs are $15 per watch. What is the firm's gain or loss at sales of 8,000 watches? 18,000 watches? What is the break-even point?

Vapor density and vapor pressure contribute : Discuss how vapor density and vapor pressure contribute to the hazards of a spilled or released hazardous material. Provide examples that illustrate your points.

Insurance annuity in order to pay off the winner : Publisher’s Clearing House wants to purchase a $3,500,000 insurance annuity in order to pay off the winner of the $10,000,000 Sweepstakes. The winner will get $500,000 in the first year, $250,000 for the next 28 years and $2,500,000 in the 30th year.

Minimum number of finishing stations : What is the minimum number of finishing stations needed to assure that on average, total time in the system (time it takes a customer from arrival at the car wash to completion of service) is no more than 20 minutes?

What is the value of this endowment in todays dollars : A wealthy philanthropist has established the following endowment for a hospital. The details are as follows: a cash deposit of $ 12 M two years from now; an annual cash deposit of $4M per year for the next five years. The first $4M will start today; ..

How much money is available in the project budget : NEF3101 PROJECT MANAGEMENT- As Project Manager you are required to prepare a PMP for the successful delivery of the project and secure client approval before implementation and importance of this exercise in terms of ensuring seamless planning and..

How is a net present value profile used to compare projects : How is a net present value profile used to compare projects? What causes conflict in the ranking of projects via net present value and internal rate of return? Does the assumption concerning the reinvestment of intermediate cash inflows tend to favor..

Important setup reduction on restaurants : As a customer why is important setup reduction on restaurants from customer A go out table until Customer B take the sit?

What herbal cures and products covered in your textbook : What conclusions do you personally come to about "natural" herbal treatments vs. standard AMA pharmacology? What herbal cures and products covered in your textbook would you personally use for everyday illnesses?

User Account

All Pages