Answered: Consider the following cash flows. The…

Consider the following cash flows. The interest rate is 10%. What is the duration (hint: you need PV)? Year 0 1 2 3 4 Cash flow 150 120 100 200

Financial Management: Theory & Practice

16th Edition

ISBN:9781337909730

Author:Brigham

Publisher:Brigham

Chapter4: Time Value Of Money

Section: Chapter Questions

Problem 12MC: (1) What is the value at the end of Year 3 of the following cash flow stream if the quoted interest...

See similar textbooks

Related questions

Q: 2. Calculate the yield to maturity on a simple loan of $12,000 that requires the repayment of…

A: In the given question we are required to calculate the yield to maturity on simple loan using…

Q: 1 $4,000 2 $4,500 3 $5,000 4 $5,500 5 $6,000 6 $6,500 7 $7,000 00 8 9 $7,500 $8,000 CAF FOO

Q: Find the PV and FV of an investment that makes the following end-of-year payments. The interest rate…

A: Present value means the present or current value of a future money. It simply means that the money…

Q: 1- The Present value (Now). 2- The Future value (at year-5)|

A: Time value of money (TVM) is used to measure the value of money at different point of time in the…

Q: Consider a series of cash flows that starts with $1,000 at the end of time 1 and decreases by $20…

A: Use the table below: PV of a cash flow = cash flow at time n /(1+ rate)^n Cost 8.00000%…

Q: Your investment will pay you the following cash flow stream: YEAR | CASH FLOW 1 |200 2 10 3 100 4…

A: The time value of money is a concept in finance that takes into account the effect of compounding to…

Q: 1. Suppose that you can buy a phone for PHP8,000 down payment with 4,000 for each of the next two…

A: The cheapest alternative is the alternative whose present value is lower.

Q: Consider a uniform series of cash flows. The first cash flow of $10,000 occurs at time 10 and the…

Q: Find the size of B in the following cash flow diagram if the interest is 8% per year. $130 1 H 2…

A: Data given: Rate=8% Arithmetic gradient from year 1 to 5= - $20

Q: What is the present value of the following cash-flow stream if the interest rate is 4%? Year 1:…

A: Present value of cashflow stream is the sum of Present value of future cashflows

Q: What would you be willing to pay (now) for the following yearend cash flows if your required return…

A: The concept of time value of money will be used here. As per the concept of time value of money the…

Q: What is the present value of the following cash flow stream if the interest rate is 5%? (Round your…

A: present value formula: present value=future cashflow1+rateyear

Q: Suppose you are given the following cash flow stream. If the interest rate is 20 percent, what is…

A: The time value of money is an important concept in finance that recognizes the idea that a sum of…

Q: Consider a project with the cash flow as depicted in Table 1: The discount rate for this project is…

A: Formulas:

Q: Suppose you receive cashflows of $10 at year 1, $12 at year 2, $14 at year 3 and $16 at year 4. What…

A: Solution:- Value of cash flows at year 2 = Future value of year 1 cash flow for 1 year + Year 2 cash…

Q: For what value of n, based on a 5% interest rate, do these cash flows have a present value of 0?

A: An Annuity is a series of payments of fixed amounts and at fixed intervals. These can be of two…

Q: Consider the following cash flows. The interest rate is 8%. What is the duration (hint: you need…

A: Interest rate = 0.08 Cash flow duration is the weighted-average time to maturity of the cash…

Q: Consider the following cash flows: Year Cash Flow 2 $ 22,800 3 40,800 5 58,800…

A: The future value is the amount that will be received at the end of a certain period. In simple…

Q: Find the annual worth (AW) that is equivalent to the following cash flow diagram, if the interest…

A: Given information: Interest rate: 8% Year Cash flows 0 0 1 0 2 2000 3 3000 4 4000 5…

Q: onsider the following cash flows: Year Cash Flow 2 $ 22,900 3 40,900 5 58,900…

A: The value of the cash flow after a particular time period with the addition of the interest amount…

Q: Calculate the duration for the following cash flows of an investment. Given the market interest…

A: Year Cash flow 0 0 1 140 2 150 3 160 4 170 5 180 6 190 7 200 8 250 Interest…

Q: Consider the following cash flow diagram. What is the value of X if the present worth of the diagram…

A: PRESENT WORTH FORMULA: PRESENT WORTH=FUTURE VALUE1+RATETIME

Q: At i = 10% per year and a loan amount of $10,000. If N= 20, what are the payments and future value?…

A: A sequence of payments of equal amounts in equal intervals of time can be called the annuity. Loan…

Q: Consider the following cash flows. The interest rate is 10%. What is the duration (hint: you need…

A: Duration measures the sensitivity of an asset's price to changes in interest rates. Duration can be…

Q: What is the present value of the following cash-flow stream if the interest rate is 4%? Year…

A: Present value means the current value of a future sum of money of cash flows given a particular rate…

Q: Consider the cash flow shown in the graph and assume that the interest rate is 10%. What is the…

A: The FV of an investment refers to the combined value of the cash flows at a given future date…

Q: Calculate the interest rate that gives a present value of 0 to the following cash flow diagram.…

A: TVM concepts and theory will be applied here. TVM refers to time value of money concepts.

Q: given the following stream of cash flows and an interest rate of 8 percent, what is its future…

A: The future value will be calculated after compounding of the present investment in the future. We…

Q: 1) What is the loanable funds market? 2) Calculate the following: You save $100 and want to see…

A: “Since you have posted a question with multiple sub-parts, we will solve the first three subparts…

Q: A sum of $10,000 now (time 0) is equivalent to the following shown cash-flow diagram: What is the…

A: The required amount can be calculated by equating the present values of future cash flows with the…

Q: What is the future value of the following set of cash flows 4 years from now? Assume interest rate…

A: Horizon is n = 4 years from now.FVn = The future value at the end of period n, of a cash flow…

Q: Consider the following cash flows: Year Cash Flow 2 $ 22,000 3 40,000 5…

A: a)

Question

14)

Consider the following cash flows. The interest rate is 10%. What is the duration (hint: you need PV)?

Year	0	1	2	3	4
Cash flow		150	120	100	200

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

Information;

VIEW

Calculation of duration;

VIEW

Step by step

Solved in 2 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

Calculate the interest rate that gives a present value of 0 to the following cash flow diagram. Please show your work. Answer is 15.4%
given the following stream of cash flows and an interest rate of 8 percent, what is its future value? Yr1=50, Yr2=60, Yr3=75, Yr4=80, Yr5=90
What is the equivalent uniform annual payment for the following investment if the interest rate is 10%? Populate the following table and compute the uniform annual payment. Show all work and provide a comment. [Hint: This problem is a mix of annuity, gradient, and a single future cash payment] ΕΟΥ Cash Flows 1 $4,000 2 $4,500 3 $5,000 4 $5,500 5 $6,000 60 $6,500 7 $7,000 00 8 $7,500 9 $8,000 10 $15,500 Annuity Gradient Future
1) What is the loanable funds market? 2) Calculate the following: You save $100 and want to see how much you will earn based on the following interest rates Interest Rate Value after 1 month -1% ? 0.5% ? 1% ? 2% ? 3) What supply factors affect the Loanable Funds market? 4) What demand factors affect the Loanable Funds market?
Need help, thanks
What is the interest rate “r” if PV=$100 and the FV=$350 in year t=12?
• What if the borrowing rate is 10%? S y1 E(rp)-B = ? σ(rp)
Find the PV and FV of an investment that makes the following end-of-year payments. The interest rate is 8%. Year Payment 1 100 2 200 3 400 Rate = 8% To find the PV, use the NPV function: PV = Year Payment x (1 + I )^(N-t) = FV1 100 1.17 116.64 2 200 1.08 216.00 3 400 1.00 400.00 Sum = ?PV = ?FV of PV = ?
someone solve this please
Please show excel formulas
Your investment will pay you the following cash flow stream: YEAR | CASH FLOW 1 |200 2 10 3 100 4 100 If your required rate of return is 12%, what is the value (i. e., present value ) of this investment at time 0? What is the future value at the end of year 7? Please explain in steps to input on BA II Plus calculator
You have an opportunity to make an investment that will pay $100 at the end of year 1, $400 at the end of year 2, $400 at the end of year 3, $400 at the end of year 4 and $300 at the end of year 5. Find the present value of this cash flow stream if the interest rate is 8%. (Hint: You can simply discount each cash flow to the present and then add them up or use the "=NPV function" in Excel or the CF key on your financial calculator a. $1,251.25 b. $1,351.25 c. $1,151.25 d. $1,451.25 a.. b.. C. . d..