Which choice is worth more in dollars today

Assignment Help Financial Management
Reference no: EM132380832

Question

You are given a choice from an insurance settlement; 30,723 dollars today in a single payment, or 5,000 dollars per year paid at the end of each year for the next 10 years. If your discount rate is 10 percent, answer the following questions.

a) Which choice is worth more in dollars today?

b) Which choice is worth more at the end of year 10, assuming all payments are reinvested at the discount rate?

Reference no: EM132380832

Questions Cloud

How many units of each product will need to be sold in order : Salvadores Manufacturing builds and sells snowboards, skis and poles. How many units of each product will need to be sold in order for Salvadores to break even?
HSA3110 Healthcare Organization And Management Question : HSA3110 Healthcare Organization And Management assignment help and assessment help, Florida State College at Jacksonville - Systems analysis serves as a vital.
Getta byte software risk management : There is a transcript portion Getta Byte Software Risk Management. Who should do the prioritization of the project risks?
Create strategic employee innovation plan to support : Create a strategic employee innovation plan to support you in strategizing the implementation and fostering of innovative thinking across the organization.
Which choice is worth more in dollars today : You are given a choice from an insurance settlement; 30,723 dollars today in a single payment, or 5,000 dollars per year paid at the end of each year.
When cecile sells the stock how much does she report : How much gain or loss does Casper recognize on the transfer of the stock? Does Casper receive a deduction for the $13,125 alimony paid?
What are some of the factors affecting an organisation : What are some of the factors affecting an organisation with multi cultural employees from different countries?
What are the reasons a manager lack these skills : Why do you think you (manager) don't have these skills? or what are the reasons a manager lack these skills?
Discuss the three focus areas in healthy people : Describe and discuss the three focus areas in Healthy People 2020 objectives that apply to infectious diseases. Define and discuss the definition of infectious.

Reviews

Write a Review

Financial Management Questions & Answers

  Calculate the present value of total inflows

The Robinson Corporation has $43 million of bonds outstanding that were issued at a coupon rate of 11 3/4 percent seven years ago. Interest rates have fallen to 10 3/4 percent. Compute the discount rate. Calculate the present value of total outflows...

  Transaction deposits on its balance sheet

National Bank currently has $500 million in transaction deposits on its balance sheet. The current reserve requirement is 8 percent, but the Federal Reserve is increasing this requirement to 10 percent. Show the balance sheet of the Federal Reserve a..

  Ethical issues that arise in domestic-global business

Identify ethical issues that arise in domestic and global business environments using an understanding of ethical concepts and of legal and business principles.

  What is about the corporate perspective

what makes investors prefer high dividend payouts and what makes them prefer low dividend payout. What’s about the corporate perspective?

  Calculate the degree of operating leverage first

The Poseidon Swim Company produces swim trunks. The average selling price for one of their swim trunks is $71.85. The variable cost per unit is $27.08, Poseidon Swim has average fixed costs per year of $6,657. Assume that current level of sales is 48..

  Compute the the firm operating cycle

Compute the the firm’s operating cycle and the firm’s cash cycle.

  What is the expected return of portfolio

What is the expected return of this portfolio?

  What is the value of share of your company stock

Based upon these estimates, what is the value of a share of your company’s stock?

  Who buys this bond today and holds it until maturity

What is the yield earned by anyone who buys this bond today and holds it until maturity?

  What are the duration and convexity of this bond

Use your zero-rate curve to price a 20 month T-bond with a 3% coupon rate. What are the duration and convexity of this bond?

  What is the expected duration of the project

What is the expected duration of the project and assuming you will begin construction on October 1, 2016, what date do you expect to complete?

  What is the return on the stock for the year

If an investment in stock has a value of $3,000 at the beginning of the year and $3,500 at the end of the year, and paid a dividend of $250 at the end of the year, what is the return on the stock for the year?

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