A series of equal semi-annual payments of $1,000 for 3 years is equivalent to what present amount at an interest rate of 12% compounded annually A) s4,944 B $2,402 $4,804 $4,111

Q: nil Two payments of $8,000 and $2,400 are due in 1 year and 2 years, respectively. Calculate the…

A: Present value is the equivalent value today of the future value and the present value of both…

Q: A perpetuity-due with annual payments of 100 has a duration of 26.88 years at an annual effective…

A: Annual payment = 100 Duration of perpetuity due = 26.88 i = Interest rate

Q: in year 0 of a uniform series of payments of $1,000 in years 2 thru 5 and another series of $2,000…

A: When a future cash flow is expressed as an equivalent value at today's worthiness based on the time…

Q: Find the lump sum deposited today that will yield the same total amount as this yearly payment (made…

A: Future value of annuity is computed as follows:-FV= A*whereFV= Future value of annuityA= annuityr=…

Q: 14) A loan of $8000 is to be repaid with monthly payments for three years at 12% interest compounded…

A:

Q: 2. $6500 was borrowed at an interest rate of 12% compounded semi-annually. If the loan is to be paid…

A: Given: Rate of interest(r) =12%p.aRate semi-annually=6%Time (t) =5 yearsTotal No. of…

Q: 5. How much interest must be paid on a loan of $4300 at 10% compounded semi- annually for 4 years?…

A: Formula: P x [ 1 + ( R / N )NT P = Principal R = Rate of interest N = Number of compounding periods…

Q: 01 %, compound monthly for three years. d 300000 Mexican Peso, compound interest of 4%, compounded…

A: Interest earned on the investment depends on the interest rate and period of interest and…

Q: At an annual effective interest rate of i, the following two payment streams have equal present…

A: Present value refers to the current value of a future sum of money or cash flow, discounted at a…

Q: Find the semi-annual payment at the end of six months, the first payment is due at the end of 7.5…

A: An annuity is a type of security where periodic payments are made over a period of time. Deferred…

Q: An amount of $50,000 is borrowed for 11 years at 4.75% interest, compounded annually. If the loan is…

A: TVM refers to the implied ability of money to earn interest because money earned at an earlier date…

Q: The first payment of the perpetuity is K and each subsequent payment is 0.5% larger than the…

A: We first need to compute the PV of the remaining payments (9 payments) using the PV of ordinary…

Q: What is the size of the payments that must be deposited at the beginning of each 6-month period in…

A: Working note:

Q: At an annual effective interest rate of i, the following two payment streams have equal present…

A: The PV of annuity can be found by using following formula:PV of deferred perpetuity formula is:

Q: A5 A 12-year loan is repaid with annual payments at the end of each year. For the first four years,…

A: x 3X

Present Value

Present value (PV) is defined as the current or present value of all future sums of cash flow or money at a specified rate of return. This rate of return is known as the discounted rate, which is essentially the interest rate, discounted over some time. The expected cash flows are discounted at a discount rate to compute the present value. The higher the discount rate, the higher the future value (FV), but the lower the present value.