4) The table below shows the interest rates available from investing in risk-free U.S. Treasury securities with different terms to maturity. Put another way, the table below presents the current spot yield curve. What is the present value (PV) of an investment that promises to pay $4,000 at the end of each year for the next four years with the first cash flow being paid one year from today? (provide your answer in the space below) 2 Term in years: Rate: 1 1.8% 2.25% The Present Value of the annuity described above is: 3 4 2.30% 2.66% 5 3.13%
4) The table below shows the interest rates available from investing in risk-free U.S. Treasury securities with different terms to maturity. Put another way, the table below presents the current spot yield curve. What is the present value (PV) of an investment that promises to pay $4,000 at the end of each year for the next four years with the first cash flow being paid one year from today? (provide your answer in the space below) 2 Term in years: Rate: 1 1.8% 2.25% The Present Value of the annuity described above is: 3 4 2.30% 2.66% 5 3.13%
Chapter12: The Cost Of Capital
Section: Chapter Questions
Problem 10QTD
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Question
![4) The table below shows the interest rates available from investing in risk-free U.S. Treasury
securities with different terms to maturity. Put another way, the table below presents the
current spot yield curve. What is the present value (PV) of an investment that promises to
pay $4,000 at the end of each year for the next four years with the first cash flow being paid
one year from today? (provide your answer in the space below)
Term in years:
Rate:
1
1.8%
2
3
4
2.25% 2.30% 2.66%
The Present Value of the annuity described above is:
5
3.13%](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F9c003f1d-42dc-4fa0-ac1e-ecb8d4bd494d%2F5d75bcb6-21a3-4543-986e-9c6bf17caf11%2Fticpop_processed.jpeg&w=3840&q=75)
Transcribed Image Text:4) The table below shows the interest rates available from investing in risk-free U.S. Treasury
securities with different terms to maturity. Put another way, the table below presents the
current spot yield curve. What is the present value (PV) of an investment that promises to
pay $4,000 at the end of each year for the next four years with the first cash flow being paid
one year from today? (provide your answer in the space below)
Term in years:
Rate:
1
1.8%
2
3
4
2.25% 2.30% 2.66%
The Present Value of the annuity described above is:
5
3.13%
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