Provide correct answer general Accounting If you are willing to pay $44,793.00 today toreceive $4,189.00 per year forever then yourrequired rate of return must be%.Assume the first payment is received oneyear from today.

Step 1: Define PerpetuityPerpetuity can distribute a stream of annual payments to an investor, which…

Answered: If you are willing to pay $44,793.00…

Principles of Accounting Volume 2

19th Edition

ISBN:9781947172609

Author:OpenStax

Publisher:OpenStax

Chapter11: Capital Budgeting Decisions

Section: Chapter Questions

Problem 6MC: You want to invest $8,000 at an annual Interest rate of 8% that compounds annually for 12 years....

See similar textbooks

Similar questions

You want to invest $8,000 at an annual Interest rate of 8% that compounds annually for 12 years. Which table will help you determine the value of your account at the end of 12 years? A. future value of one dollar ($1) B. present value of one dollar ($1) C. future value of an ordinary annuity D. present value of an ordinary annuity
Suppose you inherit a perpetuity that pays $4,000 each year. Assuming the first payment will occur one year from now and the cost of capital is 10% APR with daily compounding, what is the value of this perpetuity today? Assume 365 days in a year.
You are set to receive an annual payment of $11,000 per year for the next 16 years. Assume the interest rate is 5.9 percent. How much more are the payments worth if they are received at the beginning of the year rather than the end of the vear?
Assume you will be paid $100 next year and every year after, and the interest rate is 2%. Calculate the present value of this infinite future payment of $100
Suppose that you will receive annual payments of $16,500 for a period of 10 years. The first payment will be made 6 years from now. If the interest rate is 7%, what is the present value of this stream of payments?
If you deposit $3,500 today into an account earning an annual rate of return of 11 percent, what would your account be worth in 40 years?$__________(Round to the nearest cent.)
You will receive a cash payment of $6.4 in 4 years. If the relevant interest rate is 16.4%, how much is it worth today? Answer:
What is the present value of a perpetuity that pays $50 annually and has an annual rate of return of 17%? note: round and show your answer to the nearest dollar.
You are told that if you invest $11,100 per year for 19 years (all payments made at the beginning ofeach year) you will have accumulated $375,000 at the end of the period. What annual rate of return is theinvestment offering
Suppose you invest $385 at the end of each of the next eight years. (a) If your opportunity cost rate is 7 % compounded annually, how much will your investment be worth after the last $385 payment is made? (b) What will be the ending amount if the payments are made at the beginning of each year?
You plan to invest $2,000 per year into a retirement account. If you earn a compound annual rate of return of 5%, how many years will it take you to reach a balance of $500,000?
What is the present value of $4,000 paid each year forever, assuming a discount rate of 7% and the first payment occurs one year from now?

SEE MORE QUESTIONS

Recommended textbooks for you

Principles of Accounting Volume 2

Accounting

ISBN:

9781947172609

Author:

OpenStax

Publisher:

OpenStax College

Financial Accounting Intro Concepts Meth/Uses

Finance

ISBN:

9781285595047

Author:

Weil

Publisher:

Cengage

EBK CONTEMPORARY FINANCIAL MANAGEMENT

Finance

ISBN:

9781337514835

Author:

MOYER

Publisher:

CENGAGE LEARNING - CONSIGNMENT

Principles of Accounting Volume 2

Accounting

ISBN:

9781947172609

Author:

OpenStax

Publisher:

OpenStax College

Financial Accounting Intro Concepts Meth/Uses

Finance

ISBN:

9781285595047

Author:

Weil

Publisher:

Cengage

EBK CONTEMPORARY FINANCIAL MANAGEMENT

Finance

ISBN:

9781337514835

Author:

MOYER

Publisher:

CENGAGE LEARNING - CONSIGNMENT

SEE MORE TEXTBOOKS

If you are willing to pay $44,793.00 today to receive $4,189.00 per year forever then your required rate of return must be %. Assume the first payment is received one year from today.