You are paid £1,000 annually for 7 years, with the first payment due in one year and the last payment due in 7 years.What is the present value of all these payments using an interest rate of 2%?£ 数字Enter an answer correct to 2 decimal places.

Given in the question is that 1,000 is received as annuity for the period of seven years. The first…

Answered: What is the present value of all these…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Similar questions

You deposit $2X today, $3X one year from now and $3X two years from now. If there are different annual compounding interest rates per period as shown in the diagram below and if you had $19803 at the end of year 3, what is the value of X?
Calculating Real Rates of Return IfTreasury bills are currently paying 4.7 percent and the inflation rate is 1.9 percent, what is the approximate real rate of interest? The exact real rate?
1. What is the different between an ordinary annuity and an annuity due? Which occursmore in practice? Give a common example of both. 2. Using the example of a savings account, explain the difference between the effectiveannual rate and the annual percentage rate. 3. A mortgage instrument pays $1.5 million at the end of each of the next two years. Aninvestor has an alternative investment with the same amount of risk that will payinterest at 8% compounded semiannually. what the investor should pay for themortgage instrument?
2 Given a set of present value tables, an annual interest rate, the dollar amount of equal payments made, and the number of semiannual payments, what other information is necessary to calculate the present value of the series of payments? A. The future value of the annuity. B. The timing of the payments (whether they are at the beginning or end of the period). C. The rate of inflation. D. No other information is required.
What is the maximum interest rate the borrower will pay during the 30-year term for this loan? If the interest rate is at its maximum, what would the MTA index have to be to reach the maximum interest rate?
Compute the present value if future value (FV) = $4892, interest rate (r) = 14.0%, and number of years (t) = 16.
(b) Find the present value of an annuity-immediate such that payments start at 1, increase by annual amounts of 1 to a payment of , and the decrease by annual amounts of 1 to a final payment of 1.
In terms of an effective annual interest rate, how can the interest payment be rewritten?
Suppose that the interest rate is 1%. What is the value of the discount factor, v? V= 数字 Enter a value correct to 6 decimal places What is the rate of discount, d? d 数字 Enter a percentage correct to 2 decimal places A payment of £800 will be made in 3 years. What is the present value of this payment? £ 数字 Enter a value correct to 2 decimal places
Suppose Snli 40 and (1 + i)n = 3.7, where i is an effective annual interest rate. What is the present value of an annuity-immediate which has annual payments of 150 for 3n years?
What is the Discounted Present Value (DPV) if you expect to receive $8,000 in year 1, $9,000 in year 2 and $7,000 in year 3, when the interest rate is 8% in each year? Round your answer to one (1) decimal, do not write the dollar sign. Use the minus sign where appropriate.
Approximately how long will it take to quadruple a sum of money at 5% interest?

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