Find the present and future values of an income stream of 11000 dollars a year for 17 years. The interest rate is 9% compoundedcontinuously.Round your answers to 2 decimal places.Part 1The present value represents the amount of money you would have to deposit today in order to match what you would get fromthe income stream at the future date. The formula isPresent Value =MS(t)e" dt.Future value represents the total amount of money you would have if you deposit the income stream until a future date. Theformula isFuture Value - Present Value* erMTo start our problem we need to identify the variables.Time = M = iyearsRate = r = i%Income Stream S(t) = idollars/year

Input the following values:Payment (PMT): $11,000 (positive value since it's income)Number of…

Answered: Find the present and future values of…

Microeconomics A Contemporary Intro

10th Edition

ISBN:9781285635101

Author:MCEACHERN

Publisher:MCEACHERN

Chapter13: Capital, Interest, Entrepreneurship, And Corporate Finance

Section: Chapter Questions

Problem 13PAE

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How much money will you have in seven yearsif you deposit $7,000 in the bank at 8.5% interestcompounded daily?
QUESTION 3 1.1) Calculate the future value (rounded to the nearest whole number) of monthly deposits of R500, made for 30 years, at a nominal interest rate of 4% p.a. Then find the value of the monthly withdrawals (rounded to the nearest whole number) that can be made from this annuity for a period of 20 years, at a nominal interest rate of 5% p.a. Future value of monthly deposits = Monthly withdrawal =
Hh1.
4. A person want to have 500,000 dollars at the end of 12 years. To obtain that aim, this person deposit P at the end of each month during 12 years, with a constant interest rate 0.06 per annum compounded monthly. What is P?
1. Future and present values Suppose a relative has promised to give you $1,000 as a wedding gift the day you get engaged. Assuming a constant interest rate of 5%, consider the present and future values of this gift, depending on when you become engaged. Complete the first row of the following table by determining the value of the gift in one and two years with interest if you become engaged today and save the money. Date Received Today In 1 year In 2 years Present Value (Dollars) 1,000.00 Value in One Year (Dollars) 1,000.00 Value in Two Years (Dollars) 1,000.00 Now complete the first column of the previous table by computing the present value of the gift if you get engaged in one year or two years. The present value of the gift is if you get engaged in one year than it is if you get engaged in two years.
Suppose you deposited $200 at the end of every year for seven years in an account that earned 6% annual effevtive interest. At the end of seven years, how much would the account be worth?
Calculate the present value of an annuity with monthly deposits of $2,000 at 5% for 20 years. Discuss how the present value of an annuity will change if the deposit is doubled?
You agreed with a seller to pay Opel car of $32,000, as follows: you paid $20,000 as aninitial payment. The plan is to pay the price of the car plus the interest amount by the end of the 10th year. At the end of the third year, you managed to pay $2,000. Find theamount of money that the seller will receive after 10 years. The interest rate is (use thelast two digits of your student ID) per year. Tip: use tables and draw cash flow pm
Economics
Cash Flow is based on the notion that a dollar paid in the future is less valuable than a dollar paid today. Part 2 The present value of a loan in which $1000 is to be paid out a year from today with the interest rate equal to 5% is $. (Round your response to the neareast two decimal place) Part 3 If a loan is paid after two years, and the amount $7000 is to be paid then with a corresponding 7% interest rate, the present value of the loan is $. (Round your response to the neareast two decimal place)
Cash Flow is based on the notion that a dollar paid in the future is less valuable than a dollar paid today. Part 2 The present value of a loan in which $1000 is to be paid out a year from today with the interest rate equal to 5% is $.(Round your response to the neareast two decimal place) Part 3 If a loan is paid after two years, and the amount $7000 is to be paid then with a corresponding 7%interest rate, the present value of the loan is $.(Round your response to the neareast two decimal place)
9

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