You are the beneficiary of a trust fund that will start paying you cash flows in five years. The cash flows will be $25,000 per year, and there will be a total of 40 yearly cash flows paid. If the interest rate is 4% per year, what is the value needed in the trust fund now to fund these cash flows? Make sure to include a timeline
You are the beneficiary of a trust fund that will start paying you cash flows in five years. The cash flows will be $25,000 per year, and there will be a total of 40 yearly cash flows paid. If the interest rate is 4% per year, what is the value needed in the trust fund now to fund these cash flows? Make sure to include a timeline
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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help please answer in text form with proper workings and explanation for each and every part and steps with concept and introduction no AI no copy paste remember answer must be in proper format with all working
![You are the beneficiary of a trust fund that will start
paying you cash flows in five years. The cash flows
will be $25,000 per year, and there will be a total of
40 yearly cash flows paid. If the interest rate is 4%
per year, what is the value needed in the trust fund
now to fund these cash flows? Make sure to include
a timeline](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F1a84fe0a-60e4-4859-8a81-299ae9c95da0%2Fc10e2165-a976-498e-8935-5c4b7d1c26eb%2Fzrnpmj_processed.jpeg&w=3840&q=75)
Transcribed Image Text:You are the beneficiary of a trust fund that will start
paying you cash flows in five years. The cash flows
will be $25,000 per year, and there will be a total of
40 yearly cash flows paid. If the interest rate is 4%
per year, what is the value needed in the trust fund
now to fund these cash flows? Make sure to include
a timeline
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