What is todays value of the bequest

Reference no: EM13257227

A rich relative has bequeathed you a payment of $1,000 one year from now. Each year after that, you will receive a payment on the anniversary of the last payment that is 8% larger than the previous payment. This pattern of payments will go on forever. If the interest rate is 12% per year:

a) What is today's value of the bequest?
b) What is the value of the bequest immediately after the first payment is made?

Reference no: EM13257227

Questions Cloud

Briefly share two primary dimensions : What would be a briefly share two of your own primary dimensions of diversity, and two of your own secondary dimensions of diversity.no words limits.

What is the maximum possible coefficient of performance : To maintain a freezer box at -40°C on a summer day when the ambient temperature is 27°C, heat is removed at the rate of 1.25 kW. What is the maximum possible coefficient of performance of the freezer

What is the speed of electrons in the beam : Early black-and-white television sets used an electron beam to draw a picture on the screen. The electrons in the beam were accelerated by a voltage of 3.0 kV, What is the speed of electrons in the beam

Annual amount of depreciation using straight line : Calculate the annual amount of depreciation using straight line method

What is todays value of the bequest : A rich relative has bequeathed you a payment of $1,000 one year from now. Each year after that, you will receive a payment on the anniversary of the last payment that is 8% larger than the previous payment.

Find what is steady-state stability and transient stability : 1) During a transient fault and a permanent fault on the transmission line of a power network, mention the sequence of a line circuit breaker's operation. 2) During a network fault, the voltage and active power of a synchronous generator drops

Non cash assets and liabilities : Journalize the entries to record the liquidation outlined below,using Assets as the account title for the non cash assets and Liabilities as the account title for all creditors' claims.

Discuss the opportunity costs : Identify, quantify, and discuss the opportunity costs that arise from your decision to attend DeVry University. Using the concept of present value analysis, how would you justify your decision to acquire a college degree?

Future vale of expenditures : A new company expectsto spend $100,000 per year for labor and $125,000 per year forsupplies over the next 3 years - At an interest rate of 12% per year what is the future vale of these expenditures.

User Account

All Pages