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1. In two to three paragraphs, explain why the concept of present value is so important for corporate finance and is often the very first topic taught in any finance class. 2. Calculate the future value of the following: a. $600 if invested for five years at a 3% interest rate b. $400 if invested

A new SUV costs $33,000.

Monday, 01 September 2014 by

1. A new SUV costs $33,000. You must pay 6% sales tax. You will put 10% of this total as a down payment. For 60 months, you must borrow at an annual rate of 10%. What annual rate would have the same payments stream at 48 months? (Payments at 10% for 60 months = “X”

Could someone please help?

Monday, 01 September 2014 by

Could someone please help? N = 15 I = 7 PMT = 8500 PV = ? Table: Present value of an annuity Find the answer for number of years and the interest rate. Mutilply the annual payment by the figure from the table.

1. (1) Shelley wants to cash in her winning lottery ticket. She can either receive ten, $100,000 semiannual payments starting today, or she can receive a lump-sum payment now based on a 6% annual interest rate. What is the equivalent lump-sum payment? A. $853,020. B. $801,971. C. $744,090. D. $878,611.

1.James plans to fund his individual retirement account, beginning today, with 20 annual deposits of $2,000, which he will continue for the next 20 years. If he can earn an annual compound rate of 8 percent on his deposits, the amount in the account upon retirement will be 1. 1. $21,207. 2. 2. $91,524. 3.

Could someone please help?

Monday, 01 September 2014 by

Could someone please help? N = 15 I = 7 PMT = 8500 PV = ? Table: Present value of an annuity Find the answer for number of years and the interest rate. Mutilply the annual payment by the figure from the table.

1. (1) Shelley wants to cash in her winning lottery ticket. She can either receive ten, $100,000 semiannual payments starting today, or she can receive a lump-sum payment now based on a 6% annual interest rate. What is the equivalent lump-sum payment? A. $853,020. B. $801,971. C. $744,090. D. $878,611.

1.James plans to fund his individual retirement account, beginning today, with 20 annual deposits of $2,000, which he will continue for the next 20 years. If he can earn an annual compound rate of 8 percent on his deposits, the amount in the account upon retirement will be 1. 1. $21,207. 2. 2. $91,524. 3.

Richmond Corporation was founded 20 years ago by its president, Daniel Richmond. The company originally began as a mail-order company but has grown rapidly in recent years, in large part due to its Web-site. Because of the wide geographical dispersion of the company’s customers, it currently employs a lockbox system with collection centers in San

Question 1: Suppose you borrowed $12,000 at a rate of 9% and must repay it in 4 equal installments at the end of each of the next 4 years. How much would you still owe at the end of the first year, after you have made the first payment? A $7,636.79 B $8,038.73 C $8,461.82

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