Builtrite has calculated the average cash flow to be $11,000 with a standard deviation of $4000. What is the probability of a cash flow being between $10,000 and $14,000? (Assume a normal distribution.) O 12.93% O 37.21% O 14.93 % O 17.47 %

Builtrite has calculated the average cash flow to be $11,000 with a standard deviation of $4000. What is the probability of a cash flow being between $10,000 and $14,000? (Assume a normal distribution.) O 12.93% O 37.21% O 14.93 % O 17.47 %

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

See similar textbooks

Related questions

Q: An arithmetic gradient has cash flows of $1000 in year 4, $1200 in year 5, and amounts increasing by…

Q: What is the internal rate of return for the following set of cash flows?Year Cash Flow0 -$60,0001…

A: To find the Internal Rate of Return (IRR), we calculate the rate 𝑟r at which the Net Present Value…

Q: What is the IRR of the following set of cash flows? (Do not round intermediate calculations and…

A: Year Cash flow 0 -17100 1 7800 2 9100 3 7600

Q: In the following cash flows diagram, Determine the value of F that makes the two cash flows diagrams…

A: Future value refers to the value of the current deposit of the amount or series of deposit at some…

Q: 2. Compute the equivalent future and present worth for the cash flow in the following diagram with…

A: As per our policy, we can only provide the answer to one question. Please repost the other question…

Q: The formula below shows the computation of a future value for a series of cash flows. Your task is…

A: The movement in and out of money in a business is referred to as cash flow. Cash received denotes…

Q: What is the NPV of the following cash flows if the required rate of return is 0.09? Year 0…

A: Required rate of return = 0.09 Year Cash flow 0 -6816 1 3577 2 3505 3 2732 4 3757

Q: How many IRRs are possible for the following set of cash flows? CF0 = negative $1,000, C1 = $500, C2…

A: The expected annual rate of growth from an investment is known as the internal rate of return. IRR…

Q: (Expected Cash Flows) For each of the following, determine the expected cash flows.

A: Cash inflows: The amount of cash received by a company from the operating, investing, and financing…

Q: An arithmetic cash flow gradient series equals $600 in year 1, $800 in year 2, and amounts…

A: According to the value of money concept, the value of money changes over time. Annuity factor is a…

Q: Consider the following cash flows: Year 0 0123 Cash Flow -$28,700 15,000 13,900 10,300 a. What is…

A: Profitability Index:It represents the attractiveness of a particular investment or project. It is…

Q: a. What is the present value of the following set of cash flows, discounted at 10.6% per year? b.…

A: Present value is the equivalent value of money today that is going to be received in the future…

Q: Consider the following cash flows: Year Cash Flow -$29,900 13,800 15,100 11,500 1 3 a. What is the…

A: Profitability index measures the return generated by each dollar of investment. Itcan be calculated…

Q: What is the NPV for the following set of cash flows with a discount rate of 16.7 percent? (Round…

A: The (PV) present value of an investment project's projected net cash flows is called NPV.

Q: a. Find the present values of the following cash flow streams at an 8% discount rate. Do not round…

A: The PV of an investment refers to the combined value of the investment's cash flows assuming that…

Q: In the following cash flows diagram, Determine the value of F that makes the two cash flows diagrams…

A: To calculate equivalent cash flows at end of year 5, present value of cash flows will be calculate…

Q: For the following incremental cash flow series, what is the maximum number of i* values accord- ing…

A: A project may have multiple IRRs if there are variation in cash inflows and outflows. If there are…

Q: Compute for the value of x so that the two cashflows will be equivalent. ... 2800 1400 AX 700 3X メ 4…

A: The PV of cashflow = C/(1+r)N Where C = cashflows r = interest rate = 10% N = time of cashflows…

Q: Q1. The required return is 12%. What is the present value for the cash flows below PV = ? 30 30 30…

A: Discounting is a technique which is used to compute the present value (PV) of future cashflows by…

Q: For another example of the use of arithmetic gradient formulas, suppose that we have cash-flows that…

A: The present worth using the arithmetic gradient factor is the net value of the cash flows with…

Q: a. Find the present values of the following cash flow streams at a 7% discount rate. Do not round…

A: Discount Rate = r = 7%Stream ACash Flow for Year 0 = cf0 = $0Cash Flow for Year 1 = cf1 = $100Cash…

Q: A manufacturer projects the cash flows shown below. Determine the rate of return if the cash flows…

A: Rate of return at which the Present value of future cash flows is 0.

Q: Calculate to at least four decimal places, answers should be stated as percentages to two places for…

A: Internal rate of return Internal rate of return refers to the exact return that investment is…

Q: Given: Base amount = $5000, gradient = $1000,/= 12 %, n=5. For the given values, determine the…

A: Starting value: $5,000Gradient (g): $1,000i=12%n=5

Q: Solve for X to make the two cash flow diagrams equal. Use 10% CA rate. 1,000 200 Quarter Quarter 1 2…

A: Cash flow is a diagramatic representation of the cash in flows and outflows of a project. Upward…

Q: Consider the following cash flows over a 5-year period: −$100,000 @ t = 0;$35,000 @ t = 1; $45,000 @…

A: Net cash flows and cumulative cash flows Year Net Cash Flow Cumulative Cash Flow 0 -100,000…

Q: Consider the following cash flow stream 0 -$500 (11% 22% 27% The internal rate of return is closest…

A: Internal Rate of Return: It represents the rate at which the project will yield zero net present…

Q: ssume that an investment is forecasted to produce the following cash flows: a 10% probability of…

A: By making informed investment decisions through capital budgeting, companies can increase their…

Q: Below is an equation to compute the present value of a cash flow series. Determine the cash flow…

A: The given equation means that the value of the initial investment is $7000. The revenue from the…

Q: What is the IRR of the following set of cash flows? (Do not round intermediate calculations and…

A: IRR stands for Internal Rate of return.It is a discount rate at which the Net present value (NPV) of…

Q: For the arithmatic gradient of cash flow given below, if G= $150 , the value at year 24(V2

A: 'G' refers to the amount by which cash flows increases every year.

Q: Consider the following daily net cash flows: Day NCF 1 $15,000 2 17,000 3 13,000 4 20,000 5 14,000…

A: The mean absolute deviation for the moving average forecast: The moving averages are used to…

Q: V13= ? Year 1 12 13 14 15 i= 10% Geometric g=15% gradient 4. 3. 2.

A: CASH FLOW The net balance of cash flowing into and out of a firm at any one time is referred to as…

Q: se the given chash flow diagram and genera vo cash follow diagrams where you can use niform gradient…

A: FV is the worth of the amount on the specified date with the specified rate of interest

Q: Find the F, P, and A values for the negative cash flows shown in the diagram.

A: The question is based on the concept of future value , present value and annual value of given…

Q: An arithmetic cash flow gradient series equals $850 in year 1. $950 in year 2. and amounts…

A: The present worth method is used to determine whether an investment project should be undertaken or…

Q: Find the uniform annual equivalent for the following cash flow diagram if 10%. Use the appropriate…

A: UNIFORM ANNUAL EQUIVALENT FORMULA: EUAC=r×NPV1-1+r-n where, r = discount rate n = no of years

Q: F10 - 8% B B. B B B. |= 6.5 % 0 1 2 3 4 5 6 7 8 9 10 1 12 18 19 20 // A A A A 100,000

A: If the deposits are made on the time they grow with time bigger amounts and than they retuned into…

Q: Q2.4. An arithmetic cash flow gradient series equals $500 in year 1, $600 in year 2, and amounts…

Q: What is the NPV of the following cash flows if the required return is 18%. (Financial Calculator is…

A: Net Present Value of a project is determined by subtracting the initial cash outflows from the…

Q: What is the profitability index for the following set of cash flows if the relevant discount rate is…

A: Capital budgeting is a method of determining the profitability of the project depending upon the…

Q: Solve the following and draw the cash flow diagram From the given cash flow diagram, find the…

A: The FV of a growing annuity is to be determined. The growth rate is not given but the first and the…

Q: Given the following unconventional cash flows, find: Time, t Cash flow, CFt, $m 0 -1 1 2 3 4 5 6.12…

A: The internal rate of return is found by the investor to identify the rate by which the NPV turns nil…

Q: PV of an uneven cash flow stream 3. At a rate of 5%, what is the present value of the following cash…

A: The interest rate is 5% Cash flow at the end of year 0 is $0 Cash flow at the end of year 1 is $250…

Question

Builtrite has calculated the average cash flow to be $11,000 with a standard deviation of $4000. What is the probability of a
cash flow being between $10,000 and $14,000? (Assume a normal distribution.)
12.93%
37.21 %
14,93%
17.47 %

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

SEE SOLUTION Check out a sample Q&A here

Step 1: Introduction

VIEW

Step 2: Calculation

VIEW

Solution

VIEW

Step by step

Solved in 3 steps

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, finance and related others by exploring similar questions and additional content below.

Similar questions

Assume that you are looking at 3 perpetuities. P1 has annual cash flows of $850 in Yeata 1 through infinity (1-infinity) and present value at Year 0 of $10,119.047619. P2 has annual cash flows of $620 in Yeara 11 through infinity (11-infinity) and same effective rate as P1. P3 has annual cash flows of $480 in Years 25 through infinity (25-infinity) and same effective rate as P1 and P2. Determine the value of all three perpetuities when evaluated at Year 35.
Calculate to at least four decimal places, answers should be stated as percentages to two places for example, 0.0956 = 9.56.Do not label the answer (%, $) %3D Given the following cash flows, the internal rate of return is: Cash Year Flows 0 - 192,000 29,000 33,000 3 41,000 4 55,000 63,000 6. 59,000
You have the following cash flows: Year 0 Net Cash Flow, $ -6,000 1 -5,000 2 +12,000 3 -2,000 +6,000 For these cash flows, it has already been determined there may be more than one positive root . Calculate the EROR using the MIRR method with i 16% and is-8%. HINT: Draw the Cash Flow diagram. You must show the mathematical setup and detailed calculations you used to calculate your EROR to two decimal points by hand. An Excel solution is not sufficient.
The FASB concepts statement relating to cash flow information introduces the concept of expected cash flows when using present values for accounting measurements. Assume that Smith Company determined that it has a 40% probability of receiving $10,000 one year from now and a 60% probability of receiving $10,000 two years from now. (Click here to access the PV and FV tables to use with this problem.) Required: Using the FASB concepts, calculate the present value of the expected cash flows assuming a 12% interest rate compounded annually. Round your answer to two decimal places. $
Consider the following cash flows: Year 0 1 2 Cash Flow -$ 32,500 13,800 17,900 11, 200 What is the IRR of the cash flows? Note: Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16. Internal rate of return %
Find the NPV for the following cash flows assuming a WACC of 10%. YR CF 0 -15,000 1 6,000 2 4,000 3 2,000 4 3,000 5 2,000
Determine the ERR (External rate of return) of the cash flows if external rate (e) is given as %18. Cash Flow Year 0 1 2 3 4 5 6 Select one: a.0.3073 b.0.2988 c.0.2565 d.0.2638 e.0.3491 f.0.2783 -3000 2000 4000 -1000 3000 4000 -5000 9000
Based on the following cash flows (t=0 to t=5), calculate the Precise(Exact) ERR. Assume the MARR is at 10%. t=0 receipt of $20,000. t=1 disbursement of $15,000. t=2 disbursement of $10,000. t=3 no cash flow t=4 no cash flow t=5 receipt of $2,400. 2.82% 6.78% 9.26% 4.17% 1.43%
Following is the information given: 1. Lower control limit is Rs. 2000, 2. Interest rate per day is 0.020%, 3. Variance of daily cash flows of Rs. 500000, 4. Switching costs per transaction is Rs. 30. Calculate spread, Upper limit and Return point according to Miller Orr Model of Cash Management. Differentiate between gross and net working capital. Give an example for each.
Explain Well all question with proper answer.
2. For the below cash flows: (a) Determine the number of positive roots to the rate of return relation by performing Descarte's rule of signs and Norstrom's criterion tests. Year Cash Flow, $ -500,000 400,000 1 2.000.000 -1,500,000 2345
A product manager prepared the following forecasts for a product line: 1 3 4 5 6 and later 2 + $2m $2m $3m $4m $4m g=2.5% If the appropriate discount rate is 8.5%, what is the present value of these future cash flows?

SEE MORE QUESTIONS

Recommended textbooks for you

Essentials Of Investments

Finance

ISBN:

9781260013924

Author:

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

Publisher:

Mcgraw-hill Education,

FUNDAMENTALS OF CORPORATE FINANCE

Finance

ISBN:

9781260013962

Author:

BREALEY

Publisher:

RENT MCG

Financial Management: Theory & Practice

Finance

ISBN:

9781337909730

Author:

Brigham

Publisher:

Cengage

Foundations Of Finance

Finance

ISBN:

9780134897264

Author:

KEOWN, Arthur J., Martin, John D., PETTY, J. William

Publisher:

Pearson,

Fundamentals of Financial Management (MindTap Cou…

Finance

ISBN:

9781337395250

Author:

Eugene F. Brigham, Joel F. Houston

Publisher:

Cengage Learning

Corporate Finance (The Mcgraw-hill/Irwin Series i…

Finance

ISBN:

9780077861759

Author:

Stephen A. Ross Franco Modigliani Professor of Financial Economics Professor, Randolph W Westerfield Robert R. Dockson Deans Chair in Bus. Admin., Jeffrey Jaffe, Bradford D Jordan Professor

Publisher:

McGraw-Hill Education

Essentials Of Investments

Finance

ISBN:

9781260013924

Author:

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

Publisher:

Mcgraw-hill Education,

FUNDAMENTALS OF CORPORATE FINANCE

Finance

ISBN:

9781260013962

Author:

BREALEY

Publisher:

RENT MCG

Financial Management: Theory & Practice

Finance

ISBN:

9781337909730

Author:

Brigham

Publisher:

Cengage

Foundations Of Finance

Finance

ISBN:

9780134897264

Author:

KEOWN, Arthur J., Martin, John D., PETTY, J. William

Publisher:

Pearson,

Fundamentals of Financial Management (MindTap Cou…

Finance

ISBN:

9781337395250

Author:

Eugene F. Brigham, Joel F. Houston

Publisher:

Cengage Learning

Corporate Finance (The Mcgraw-hill/Irwin Series i…

Finance

ISBN:

9780077861759

Author:

Stephen A. Ross Franco Modigliani Professor of Financial Economics Professor, Randolph W Westerfield Robert R. Dockson Deans Chair in Bus. Admin., Jeffrey Jaffe, Bradford D Jordan Professor

Publisher:

McGraw-Hill Education

SEE MORE TEXTBOOKS