Answered: At an annual effective interest rate of…

At an annual effective interest rate of 5%, the present vakue of a perpetuity immediate with successive annual payrnents of 10, 13, 19, is equal to X Calculate X

Essentials Of Investments

11th Edition

ISBN:9781260013924

Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Chapter1: Investments: Background And Issues

Section: Chapter Questions

Problem 1PS

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Similar questions

Find the value of the ordinary annuity at the end of the indicated time period. The payment are frequency of deposits and annual interest rate are in time period. TR given amount $750 quarterly 5% eight years.
Find the future values of the ordinary annuities at the given annual rate r compounded as indicated. The payments are made to coincide with the periods of compounding. (Round your answer to the nearest cent.) PMT = $280, r = 8.2%, compounded monthly for 30 years
The income stream b = (1000, 1500, 2500, 4000) consists of payments made at the end of the next four years. Find the present value of b for an interest rate of 9% compounded annually.
Using annual, semiannual, and quarterly compunding periods, (1) calculate the future value i f $10,000 is deposited intially at 8% annual interest for 8 years , and (2) determine the effective annual rate (EAR)
Find the PV of a 26-year annuity-immediate with payments of 1, 2, 3, ..., 26 at an annual effective rate of interest ii = 7%. Possible Answers A 113.2 B 114.7 C 115.9 D 116.8 E 117.5
Find the future values of the ordinary annuities at the given annual rate r compounded as indicated. The payments are made to coincide with the periods of compounding. (Round your answer to the nearest cent.) PMT = $200, r = 2.7%, compounded semiannually for 25 years
The following payments are to be received and Using an annual effective interest rate of 2% (a) with payments P50,000 at the end of the first year, P52,500 at the end of the second year, P 55,000 at the end of the third year and so on, until the final payment is P75,000. Determine the present value of these payments at time 0 and accumulated value at the time of the last payment using Increasing Annuity formulas instead. You may verify results only using the general formula. (b) Do the same as in (b) whenever the payments are P 50,000 at the end of the first year, P47,500 at the end of the second year, P 45,000 at the end of the third year and so on, until the final payment is P 2,500. 3 (c) What if the payments in (a) increase by 1% for 10 years? 5 (d) What if the payments in (a) and (c) are perpetual payments, how much is the initial worth of each?
A 20-year annuity X has annual payments of $10,000 at the beginning of each year for 10 years, then annual payments of $20,000 at the beginning of each year for the next 10 years. A perpetuity Y has payments of Q at the end of each year for 10 years, then payments of 2Q at the end of each year thereafter. The present values of X and Y are equal when calculated using an annual effective interest rate of 5%. Find Q.
What is the present value of the following annuities? 70 a year for 3 -years discounted back to the present at 7 percent
A perpetuity-due with annual payments consists often level payments of X followed by a series of increasing payments. Beginning with the eleventh payment, each payment is 1.5% larger than the preceding payment. Using an annual effective interest rate of 5%, the present value of the perpetuity is 45,000. Calculate X. B C 1,679 E 1,696 1,737 D 1,763 1,781
At an annual effective interest rate of 5%, an annuity immediate with 4N level annual payments of 1000 has a present value of 14,898.13. Determine the fraction of the total present value represented by the first set of N payments and the third set of N payments combined. A. 0.579 B. 0.585 C. 0.614 D. 0.643 E. 0.672
Find the future value of the following annuity due. Payments of $200 for 6 years at 8% compounded semiannually S≈$ (Round to the nearest cent as needed.)

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