Problem 11-10 (Algo)Required:A pension plan is obligated to make disbursements of $1.2 million, $2.2 million, and $1.2 million at the end of each of the next threeyears, respectively. Find the duration of the plan's obligations if the interest rate is 10% annually. (Do not round intermediatecalculations. Round your answer to 4 decimal places.)Durationyears

In fixed income investments, duration serves as a crucial metric for assessing a bond's price…

Answered: Problem 11-10 (Algo) Required: A…

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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Under a new company employees savings plan, an employee will pay P 250 at the beginning of each month for 5 years, and the management guarantees accumulation of the savings at 5% compounded annually. How much will be the amount of the savings plan of each employee after 5 years? Select one: O a. P 17,020 O b. P 15,826 O c. P 14,882 O d. P 17,456
UNIT 7-18
6. Choose the best retirement plan for the employee from among those presented below. interest is 12.00% pa compounded monthly. Select the correct response: P200,000 now plus P1.7 M after 2 years P100,000/month for 1 year plus P400,000 after one year P64,000/month for 2 years O P1.65M on the 18th month
14. Annuity A pays X at the end of each year. The first payment occurs at time 6 years, and the last payment occurs at time 10 years. Annuity B pays $81.06 at the end of each year. The first payment occurs at time 1 year, and the last payment occurs at time 5 years. The current value of annuity B at the end of five years is $475.54. The present value at time 0 of annuity A is twice the present value at time 0 of annuity B. Determine X. D 350 E 387 A 238 C 313 B 275
Problem 1: Read each problem carefully and answer each question to solve the problem. Find the period of deferral in each of the following deferral annuity problems (one way to find the period of deferral is to count the number of artificial payment (k). Make a diagram 3. Payment of P 700.00 every month for one (1) year that will start at the end of the third month Time Diagram Answer
blem #1: $10,000 is used to purchase an appropriate size annuity that has level annual payments for 18 years. The price of the annuity is based on an effective annual rate of 11.2%. As each payment is received, it is put into a fund that earns an effective annual rate of 7%. (a) Determine the accumulated value of the investment at the end of 18 years. (b) If the $10,000 were put into a fund that was to produce the same final value after 18 years, what annual effective rate would that fund have to offer?
Construct an annuity table showing the deposits, interests, and balances for the saving plan below (compulsory to show the working steps to get the interest value): a) $350 is invested in an increasing annuity at the end of every 6 months for 3 years. The account pays 10.25% interest rate compounded semiannually. Period Beginning Interest Deposit Ending balance (Every 6 months) Balance 1 $0.00 $0.00 $350.00 $350.00 3 4 (Copy this table to your answer script)
Please no excel. Thanks An 18-year loan of 21,000 may be repaid under the following two methods: amortization method with equal annual payments at an annual effective rate of 6.1% sinking fund method in which the lender receives an annual effective rate of 6.450% and the sinking fund earns an annual effective rate of j. Both methods require payment of X to be made at the end of each year for 18 years. Calculate j. Round your answer to one decimal place
A company will receive payments of $1,500 per year for the next four years under a subscription contract. The first payment will be made at the beginning of the contract. Assuming an annual interest rate of 3% is appropriate, the present value of an ordinary annuity is 3.71710 x $1,500 = $5,576, and the present value of an annuity due is 3.82861 x $1,500 = $5,743. Which amount must the company record for this sale in accordance with generally accepted accounting principles (GAAP) if collection is reasonably assured? $0 $5,576 $6,000 $5,743
You expect to receive the following: $4,448 $22,900 $3,813 at the end of each year for 12 years today at the end of year 6 at the end of each year forever $843 $10,528 at the end of 15 years What is the uniform annual payment for the first 12 years equivalent to the above payment scheme, if the interest rate is 8%? Enter your answer as follow: 123456
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An insurance firm agrees to pay you $3,310 at the end of 20 years if you pay a premium of $100 per year at the end of each of the 20 years. Find the internal rate of return to the nearest whole percentage point. 9% O 7% 5% 3% O 11%

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