Answered: Mark deposits 10000 today, and is…

Business

Finance

Mark deposits 10000 today, and is promised an amount of 17000 in eight years. What is the implied rate of return?

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

See similar textbooks

Related questions

Q: What is the present value of $30,000 you will receive 7 years in the future, ass

A: The present value is equivalent value of money to be received today that will be equal to money to…

Q: Your father will get a gratuity of ₹ 350,000 after 10 years from now on his retirement. His employer…

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

Q: You have $27, 467.55 in a brokerage account, and you plan to deposit an additional $5, 000 at the…

A: The amount in the brokerage account (PV) at present is $27,467.55.The annual deposit (PMT) is…

Q: Your brother has offered to give you either $35,000 today or $70,000 in 11 years. If the interest…

A: Present Value is the current price of future value which will be received in near future at some…

Q: Suppose you need to accumulate GHȼ100,000 in 10 years. You plan to make a deposit in a bank now, at…

A: The future value of the growing annuity is the future worth of a cash flow series growing at a…

Q: Suppose you inherit a perpetuity that pays $4,000 each year. Assuming the first payment will occur…

A: The given rate is APR rate i.e. annual percentage rate. The APR is with daily compounding. The EAR…

Q: Interest rates are 10%. Suppose you deposit the PV (present value) of a 7 year, $5000 annuity in the…

A: An annuity is a cash flow that occurs in each period and the amount is fixed or constant. In this…

Q: Suppose that if you purchase a US Treasury bond, it will pay you a one-time payment of $5000 in 10…

A: A Treasury Bond is a bond issued by the Government of USA. It carries no risk of default and are…

Q: You have $67,046.95 in a brokerage account, and you plan to deposit an additional $3,000 at the end…

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

Q: You have just received a windfall from an investment you made in a friend's business. She will be…

A: We need to use the following equation to calculate present and future value FV=PV(1+i)n where FV…

Q: ou are offered an annuity that will pay R17,000 per year for 7 years (the first payment will be made…

A: Given: Annuity amount = R17,000 Year = 7 Discount rate = 11%

Q: What will be the value of these deposits 12 years later if earning 9% APR compounded annually?

A: Time value of money (TVM) refers to the method or technique which is used to measure the amount of…

Q: You will receive an inheritance of 116034 in 10 years. If the interest rate is 3.8%, how much is it…

A: Time value of money is one of the important concept in finance. It says that a dollar amount…

Q: Time Value Tom can either deposit $20,000 into an account paying 8% annual interest either today or…

A: Deposit amount = $20,000 Interest rate = 8% Period for future value = 40 Years from now Option - 1…

Q: You decide to invest $14.4k today into a security that will make fixed annual payments to you of…

A: The money's present value is its current worth compared to some of its potential future value after…

Q: what is the present value

A: The time value of money means that the amount of money received in the present period will have…

Q: Write the present value function, letting x represent the number of years.

A: Time value of money: The time value of money is the idea that the value of money received today will…

Q: An investor is considering an investment that will pay $2,280 at the end of each year for the next…

A: Payment = p = $2280Time = t = 10Rate of Return = r = 12%

Q: sume you have just found out you are entitle lling to take today in exchange for the future:

A: Answer : Future value = Present value * (1 + rate) ^Time Rate = 18% Time = 19 years

Q: Franco is considering investing P18,500 in an investment that will have a maturity value of P32,500…

A: Investment amount (P) = P18,500 Maturity value (F) = P32,500 Period = 8 Years Monthly period (n) =…

Q: You are offered an investment that will pay you (and your heirs) €40,000 income per year forever,…

A: Annual income forever = €40,00 Annual interest rate = 8%

Q: A perpetuity will make its first payment in 20 years. The first payment will be $5,000, and future…

A: Perpetuity means a series of infinite numbers of payments of the same size occurs in an equal…

Q: etna is offering customers who invest $10,000 with them today a payment of $1,500 every 1.5 years in…

A: Concept, first we will calculate the effective rate for the 1.5 year period which is nothing buy the…

Q: CHAR is offered an annuity that will pay P24,000 per year for 11 years (the first payment will occur…

A: Annual payment (P) = P24,000 Period (n) = 11 Interest rate (r) = 13%

Q: You have $51, 854.38 in a brokerage account, and you plan to deposit an additional $3,000 at the end…

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

Q: After 10 years, the estimated price of an apartment of 20 pyeong is 200 million won. If you save a…

A: PRESENT VALUE = FUTURE VALUE / PVAF(10%, 10 YEARS) = 200/ 6.1446 = 32.55 Million Postion of…

Q: What is the present value of a security that will pay $2,000 at the end of each year for 6 years if…

A: The present value can be calculated as follows if the payments are made at the end : Calculations…

Q: An annuity offers to pay £8,700 per year for 20 years, and the nominal annual bank interest rate is…

A: Present Value of annuity refers to the present value of all the future payments of and series of…

Q: You are told that if you invest $11,600 per year for 18 years (all payments made at the beginning of…

A: Annual rate of return refers to the percentage of earnings or interest earned on the investment made…

Q: Calculate the present value of this infinite future payment of $100

A: Time value of money (TVM) refers to the method used to measure the amount of money at different…

Q: How much should an investor be willing to pay for an investment product that offers to pay 25,000…

A: Here we will have to use the concept of time value of money and find the present value of the…

Q: You expect to receive $3,100 upon your graduation and will invest your windfall at an interest rate…

A: Here, Particulars Values Present value of money (PV) $ 3,100.00 Quarterly interest rate…

Q: Assume you are to receive a 5-year annuity with annual payments of £1,000. The first payment will be…

A: The Future Value of an Ordinary Annuity refers to the concept which gives out the compounded or…

Q: You are investigating an investment opportunity. The security requires you to make monthly payments…

A: Future value is an estimate of future cash flows that may be received at a future date, discounted…

Q: You will invest in something that will give you a payment of $211 two times each year. You plan to…

A: Step 1 An annuity is a contract that you have with an insurance provider that calls for periodic…

Q: a. If his opportunity cost is 9% compounded annually, what value should he place on this…

A: Time value of money (TVM) refers to the method used to measure the amount of money at different…

Q: Linda expects to receive P35,569.22 , 9 years from now. How much should she invests for three…

A: Annuity is the series of payment made by an investor over the period of time to accumulate future…

Q: An annuity offers to pay £9,700 per year for 20 years, and the nominal annual bankinterest rate is…

A: Present Value of annuity refers to the present value of all the future payments of and series of…

Q: What is the present value of all these payments using an interest rate of 4%?

A: We have to calculate the present value of the cash flow in all these 10 years In question, cash flow…

Q: An investor puts P200 in a money market account TODAY that returns 3% with monthly compounding. The…

A: Investment = 200 Monthly Compounding Return % = 3%/12 per month = 0.25% per month Time Period = 2…

Q: ou are offered an investment that requires you to put up $5,000 today in exchange for $12,000 10…

A: Future value is the compounded value of a sum of money invested for a period of time at a specified…

Q: What would you pay for an investment that pays you $4300000 after twenty years? Assume that the…

A: Principal amount invested now will become certain amount after certain period of time at specific…

Question

Mark deposits 10000 today, and is promised an amount of 17000 in eight years. What is the implied rate of return?

Definition Definition Percentage gain or loss from a specific investment over time. The rate of return is the difference between the closing and initial values of an investment divided by the initial value of the investment. The closing value includes any intermediate cash flows such as dividends or interest amounts.

AI-Generated Solution

AI-generated content may present inaccurate or offensive content that does not represent bartleby’s views.

Unlock instant AI solutions

Tap the button
to generate a solution

Click the button to generate
a solution

SEE SOLUTION

Similar questions

What's the future value of a 12%, 5-year ordinary annuity that pays $700 each year? If this was an annuity due, what would its future value be? Round your answers to the nearest cent.
Suppose that you have inherited an annuity that will initially pay $1,755 six years from now. Each of the following 30 annual payments will be 3% larger than the prior payment. Assuming that the annual opportunity cost of capital is 7%, what is the value of this annuity today? Round your final answer to two decimals.
If you are expecting a settlement of $10000 at the end of each year for five years, how much this annuity is worth today if the interest rate is 8%?
6. An investor is considering an investment that will pay $2,150 at the end of each year for the next 10 years. He expects to earn an annual return of 18 percent on his investment. How much should he pay today for the investment? How much should he pay if the investment returns are paid at the beginning of each year?
An investor pays £300 now in order to get £150 in 4 years' time and £200 in 8 years' time. What is the annual effective rate of interest earned on this investment?
suppose you are buying your first condo for 145,000 and you will make $15,000 down payment. you have arranged to finnace the remainder with a 30 year monthly payment amortized mortgage at a 55 nominal interest rate with first payment due in one month what will your monthly payments be? how much of first month payment is the prindipal
A client anticipates depositing 200 € at the end of each month for the first year, increasing these deposits at a constant rate of 2% each year. If this client does not make the anticipated contributions at the end of the sixth month of each year, calculate how much he will have at the end of 11 years if the nominal annual interest rate is 12%.
You are looking at an investment that will make annual payments of $28,000, $32,000, $66,000, and $99,000 to you each year over the next four years, respectively. All payments will be made at the end of the year. If the appropriate interest rate is 3.6 percent, what is the value of the investment offer today?
A woman plans to make a total of eight equal deposits, with the first deposit one year from now and succeeding deposits at 2-year intervals, so that she will be able to withdraw $12500 per year for 10 years starting 22 years from now. How much must be the equal deposits if the interest rate is a nominal 12% per year compounded monthly?
What is the future value of a $1,000 annuity payment over 4 years if the interest rates are 8 percent?
Hansi is promised to receive $89 in 9 years. Hansi, being profligate, prefers to spend this promised amount of money today. What is the equivalent present value of the settlement if the interest rate is 6.00%?
How much would Sally be willing to pay today for an annuity expected to pay $4,000 per year for 5 year, with the first payment starting in 3 years. Assuming she requires a 10% return?

SEE MORE QUESTIONS

Recommended textbooks for you

Essentials Of Investments

Finance

ISBN:

9781260013924

Author:

Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:

Mcgraw-hill Education,

FUNDAMENTALS OF CORPORATE FINANCE

Finance

ISBN:

9781260013962

Author:

BREALEY

Publisher:

RENT MCG

Financial Management: Theory & Practice

Finance

ISBN:

9781337909730

Author:

Brigham

Publisher:

Cengage

Foundations Of Finance

Finance

ISBN:

9780134897264

Author:

KEOWN, Arthur J., Martin, John D., PETTY, J. William

Publisher:

Pearson,

Fundamentals of Financial Management (MindTap Cou…

Finance

ISBN:

9781337395250

Author:

Eugene F. Brigham, Joel F. Houston

Publisher:

Cengage Learning

Corporate Finance (The Mcgraw-hill/Irwin Series i…

Finance

ISBN:

9780077861759

Author:

Stephen A. Ross Franco Modigliani Professor of Financial Economics Professor, Randolph W Westerfield Robert R. Dockson Deans Chair in Bus. Admin., Jeffrey Jaffe, Bradford D Jordan Professor

Publisher:

McGraw-Hill Education

Essentials Of Investments

Finance

ISBN:

9781260013924

Author:

Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:

Mcgraw-hill Education,

FUNDAMENTALS OF CORPORATE FINANCE

Finance

ISBN:

9781260013962

Author:

BREALEY

Publisher:

RENT MCG

Financial Management: Theory & Practice

Finance

ISBN:

9781337909730

Author:

Brigham

Publisher:

Cengage

Foundations Of Finance

Finance

ISBN:

9780134897264

Author:

KEOWN, Arthur J., Martin, John D., PETTY, J. William

Publisher:

Pearson,

Fundamentals of Financial Management (MindTap Cou…

Finance

ISBN:

9781337395250

Author:

Eugene F. Brigham, Joel F. Houston

Publisher:

Cengage Learning

Corporate Finance (The Mcgraw-hill/Irwin Series i…

Finance

ISBN:

9780077861759

Author:

Stephen A. Ross Franco Modigliani Professor of Financial Economics Professor, Randolph W Westerfield Robert R. Dockson Deans Chair in Bus. Admin., Jeffrey Jaffe, Bradford D Jordan Professor

Publisher:

McGraw-Hill Education

SEE MORE TEXTBOOKS