eBook Problem Walk-Through the present value of $600 due in the future under each of these conditions: a. 9% nominal rate, semiannual compounding, discounted back 8 years. Do not round intermediate calculations. Round your answer to the nearest cent. $ b. 9% nominal rate, quarterly compounding, discounted back 8 years. Do not round intermediate calculations. Round your answer to the nearest cent. $ c. 9% nominal rate, monthly compounding, discounted back 1 year. Do not round intermediate calculations. Round your answer to the nearest cent. $ d. Why do the differences in the PVS occur?
eBook Problem Walk-Through the present value of $600 due in the future under each of these conditions: a. 9% nominal rate, semiannual compounding, discounted back 8 years. Do not round intermediate calculations. Round your answer to the nearest cent. $ b. 9% nominal rate, quarterly compounding, discounted back 8 years. Do not round intermediate calculations. Round your answer to the nearest cent. $ c. 9% nominal rate, monthly compounding, discounted back 1 year. Do not round intermediate calculations. Round your answer to the nearest cent. $ d. Why do the differences in the PVS occur?
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
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Transcribed Image Text:11. Problem 5.24 (Present Value for Various Discounting Periods)
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Problem Walk-Through
Find the present value of $600 due in the future under each of these conditions:
a. 9% nominal rate, semiannual compounding, discounted back 8 years. Do not round intermediate calculations. Round your answer to the nearest cent.
$
b. 9% nominal rate, quarterly compounding, discounted back 8 years. Do not round intermediate calculations. Round your answer to the nearest cent.
$
c. 9% nominal rate, monthly compounding, discounted back 1 year. Do not round intermediate calculations. Round your answer to the nearest cent.
$
d. Why do the differences in the PVs occur?
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The present values decline as periods per year increase.
The present values decline as periods per year decrease.
The present values increase as periods per year increase.
The present values are not affected by changes in the number of periods per year.
The present values are positively related to the number of discounting periods per year.
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