The average price of a new home is $520,000.If new home prices are increasing at a rate of 10%per year, how much will a new home cost in 6 years?3.10 What will be the amount accumulated by eachof these present investments?(a) $4,000 in 6 years at 7% compounded annually.(b) $6,750 in 15 years at 9% compounded annually.(c) $10,500 in 25 years at 6% compounded annually.(d) $15,000 in 8 years at 7.5% compounded annually.

Q: What is the value today of receiving a single payment of $72,887.00 in 29.0 years if your required…

A: The present value represents the current worth of a future value that will be received at a…

Q: if you invest $10,000 per year at the end of each year for three years at in 6.7% rate of return…

A: Future Value Annuity = PMT×Where:FV - future value of the annuity.PMT - annual payment r - annual…

Q: An investment offers $12,000 per year for 20 years, with the first payment occurring one year from…

A: The time value of money concept holds the utmost relevance while determining the future value and…

Q: You deposit $19,000 today in an investment account and the annual rate of return is 12%, what will…

A: Formulas: Future value = Present value *(1+rate)^years

Q: If you have $60,000 in a bank account that is paying an interest rate of 4 percent that is being…

A: To find out how many years it will take to double an investment with a constant interest rate, you…

Q: You are looking at an investment that promises to pay $2000 per year forever! What is the value of…

A: A cash flow that goes on forever is called a perpetuity.Here the cash flow of $2000 per year forever…

Q: How much is the sum of the present value of the expected return over those periods

A: Cash Flows (Year 1-10) (CF) =  $15,000 per year Annual interest rate (r) = 5% Time Period (t) = 10…

Q: An investment pays an annual cash flow of $1 forever. The appropriate discount rate is 4% per year.…

A: Annual cash flow (C) = $1Discount rate (r) = 0.04Present value = ?Present value will be the…

Q: What is the value today of receiving a single payment of $81,374 in 4 years if your required rate of…

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

Q: 3. An investment offers P4,900 per year for 15 years, with the first payment occurring one year…

A: An Annuity is a continuous flow of systematic timely cash flows made or received for a stipulated…

Q: A. Assume that you have $7500 to invest. You plan to invest it for 10 years at a rate of 7% per…

A: Future Value = Present Value * (1 + Interest Rate)^Time

Q: You wish to have an investment that will bring about $50 000 in ten years, and the rate of return is…

A: Value of investments after 10 years=$50,000Rate of return(r)=8%Time(n)=10 years

Q: You have $10,000 to invest for five years. - How much additional interest will you earn if the…

A: Given Information : Amount invested - $10,000 (Present value) Rate of interest (r) - 5%/4.5% Time…

Q: 1. How much money will you have in an account after 16 years if your initial investment is $8300…

A: Compound interest is the interest calculated on both the principal amount as well as the interest…

Q: 3. Suppose one plans to invest $750 a month this year, $800 a month next year, $850 a month the year…

A: Future value of growing annuity is the future value of current stream of cash flows that keeps…

Q: How much will I have 8 years from now, if I will invest $10398 at the end of each three months for…

A: The future value of the annuity is the total value of all the payments which is occurred regularly…

Q: An investment company owns land now worth $500,000 that is increasing in value each year. If the…

A: Given Data: ParticularsAmountCurrent value of land500000Doubling Period (in years)7

Q: If you invest $10,000 per year at the end of each year for 3 years at an 5.5% rate of return, you…

A: Future Value of anuity = P * [ { (1 + r )n -1 } /r ] where, P =  periodic payment r = interest rate…

Q: Suppose that you plan to invest $1500 at the end of each of the next 9 years, and you want to have…

A: Rate of return refers to the minimum return to be earned by the investors on the initial investment…

Q: If Quail Company invests $50,000 today, it can expect to receive $10,000 at the end of each year for…

A: Net Present Value = Present value of cash inflows + Present value of salvage value - Initial…

Q: What is the present value of a property now if its future value is predicted to be $7,500,000 at the…

A: Present value shows that the sum of money worth more today as compared to tomorrow. Numerous…

Q: 1. Calculate the present worth of a $ 580,000 home with a mortgage rate of 5% compounded monthly for…

A: The solution requires understanding of time value of money. We need to calculate future values and…

Q: is the rate of return on an investment of $9210 if the investor will recieve $2000 each year for the…

A: The given problem can be solved using RATE function in excel. RATE function computes interest rate…

Q: 5. In eighteen years, you require an annuity stream of income that will pay out $100,000 per year…

A: An annuity refers to a fixed stream of payments. In this case the annuity amount is $100,000 per…

Q: how much should you invest now in a single investment if you expect to withdraw $45,000 in 9 years…

A: Step 1: Introduction Present Value: The value of the money identified today for the money/sum of…

Q: You invest $1,900 three years from today and $1,100 four years from today. How much will you have in…

A: Finance is the management of money. The time value of money principle explains that a dollar today…

Q: An investment offers $8800 per year for 14 years with the first payment occuring one year from now.…

A: Hi! Thank you for the question, As per the honor code, we are allowed to answer three sub-parts at a…

Q: You are going to invest $9237 today and $9695 1 year from today.  If you expect to earn a return of…

A: Step 1 Future value is the amount of money that, with time and an interest rate, is invested now and…

Q: If Quail Company invests $46,000 today, it can expect to receive $12,000 at the end of each year for…

A: Net present value method is used to evaluate the investment projects. We can evaluate the project by…

Q: You invest $50,000 for three years that will earn 3.6 percent compounded continuously. What will be…

A: Given Information: Amount invested=$50,000 Interest Rate=3.6% compounded continuously Time(in…

Q: About how many years would it take for your investment to grow threefold if it were invested at an…

A: In the given problem we require to calculate the number of years that will make the investment three…

Q: Your company plans to invest $20,000 at the end of each year or years 1 through 5, The company will…

A: Present Value: It represents the present worth of the future amount and is computed by multiplying…

Q: If you would like to have $20,000 in 5 years, how much should you invest today if your investment…

A: Present value is the value today of future cash flows discounted at the required rate of return for…

Q: Ssume you are buying an apartment with $ 500,000. Consider you make 8% per year (i=8%) on this…

A: Capital recovery amount is that amount which should be recovered.

Q: Property values in your neighborhood are predicted to increase at a rate of 7 percent per year. If…

A: Step 1 The value of an invested sum of money made today will be more in the future by using the…

Q: You purchase an investment for $1,000. You expect it will increase in value at a rate of 9% per…

A: Initial Investment is $1,000 rate is 9% per yeat time period is 12 years   To Find:- Worth of…

Q: If you invest $10,000 today for 8 years, how much will the original investment be worth if…

A: Solution:When some amount is invested somewhere, it earns interest on it.The amount initially…

Q: A business is planning to purchase a piece of equipment that will produce a continuous stream of…

A: ### Present Value of a Continuous Income StreamGiven:- Rate of flow  f(t) = 9000  (constant)-…

Q: we have $1,000 and we are offered to put it in investments that will double this money in 8 years,…

A: Future Value is the value of current investments at a certain future date at the assumed interest…

Present Value

Present value (PV) is defined as the current or present value of all future sums of cash flow or money at a specified rate of return. This rate of return is known as the discounted rate, which is essentially the interest rate, discounted over some time. The expected cash flows are discounted at a discount rate to compute the present value. The higher the discount rate, the higher the future value (FV), but the lower the present value.