If the current rate of interest is 10% and interest is compounded semiannually, what is the present valueof receiving $10,000 at the end of 7 years?Question 3lf the current interest rate is 12% and interest is compounded semiannually, what is the present value ofreceiving $5,000 each year for 10 years?

If the current rate of interest is 10% and interest is compounded semiannually, what is the present valueof receiving $10,000 at the end of 7 years?Question 3lf the current interest rate is 12% and interest is compounded semiannually, what is the present value ofreceiving $5,000 each year for 10 years?

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

Calculate the future value of $8,000 in a. 9 years at an interest rate of 9% per year. b. 18 years at an interest rate of 9% per year. c. 9 years at an interest rate of 18% per year. d. Why is the amount of interest earned in part (a) less than half the amount of interest earned in part (b)?
a) If a person deposits $10,000 at 10% per year simple interest, what compound interest rate would yield the same amount of money in 3 years?
3. 4. How much interest on interest is earned in an account by the end of 5 years if $100,000 is deposited and interest is 4% per year, compounded continuously? How much will be in an account at the end of five years the amount deposited today is $10,000 and interest is 8% per year, compounded semi-annually? Complete the following, solving for the present value, PV: Case A B C Future value $10,000 $563,000 $5,000 Interest Number of rate periods 5% 5 4% 5.5% 20 3 Present value
What is the present value of a $500 perpetuity if the interest rate is 4%? If interest rates doubled to 8%, what would its present value be? Round your answers to the nearest cent. Present value at 4%: $ Present value at 8%: $
4. If you deposit $1000 in one year, $2000 in two years, and $3000 in three years, how much will you have in three years? Assume a 7 percent annum interest rate. NPV FV
Find the principle if the interest amount at the end of 2.5 years is $450 for a simple interest rate of 10% per year.
A perpetuity pays $250 per year and interest rates are 7.0 percent. How much would its value change if interest rates increased to 8.5 percent? (Round your answer to 2 decimal places.) Change in value Did the value increase or decrease? decrease O increase
What is the present value of a perpetuity that pays annual, end-of-year payments of $850 every year? Use a nominal rate of 8.00%. O $10,625 O $10,952 O $10,241 O $9,133 O $9,004
Find the present value of the given future amount. $68,000 for 7 months at 8% simple interest What is the present value? $ (Round to the nearest dollar as needed.)
8. What is the present value of a 5-year annuity of $1000 per year that begins 3 years from today (end of year 2) if the discount rate is 7%?
If the accumulated value at time n of $1 per year paid continuously each year for n years is 25% more than the accumulated value at time n of $1 per year paid at the end of each year for n years under the same interest rate assumption, then how does the present value at time zero of an annuity of $1 per year paid at the end of each year for n years compare to the present value of an annuity of $1 per year paid continuously each year for n years? A. The annuity immediate is about 15% less B. The annuity immediate is about 20% less C. The annuity immediate is about 25% less D. The annuity immediate is about 25% greater E. Cannot be determined from the information given.
What are the future value and the interest earned if $3800 is invested for 6 years at 8% compounded quarterly? (Round your answers to the nearest cent.) future value $ interest earned $

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