You believe you have discovered a new medical device. You anticipate it will take additional time to get the device fully operational, run clinical trials, obtain FDA approval, and sell to a buyer for $280,000. Assume a discount rate of 8% compounded annually. What is the value today of discovering the medical device, assuming you sell it for $280,000 in (a) two years, (b) three years, or (c) four years? Note: Use tables, Excel, or a financial calculator. Round your answers to 2 decimal places. (FV of $1, PV of $1, FVA of $1, and PVA of $1) a. b. C. Payment Amount $ 280,000 280,000 280,000 Interest Rate Compounding 8% Annually 8% Annually 8% Annually Period Due 2 years 3 years 4 years Present Value
You believe you have discovered a new medical device. You anticipate it will take additional time to get the device fully operational, run clinical trials, obtain FDA approval, and sell to a buyer for $280,000. Assume a discount rate of 8% compounded annually. What is the value today of discovering the medical device, assuming you sell it for $280,000 in (a) two years, (b) three years, or (c) four years? Note: Use tables, Excel, or a financial calculator. Round your answers to 2 decimal places. (FV of $1, PV of $1, FVA of $1, and PVA of $1) a. b. C. Payment Amount $ 280,000 280,000 280,000 Interest Rate Compounding 8% Annually 8% Annually 8% Annually Period Due 2 years 3 years 4 years Present Value
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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Transcribed Image Text:You believe you have discovered a new medical device. You anticipate it will take additional time to get the device fully operational,
run clinical trials, obtain FDA approval, and sell to a buyer for $280,000. Assume a discount rate of 8% compounded annually. What is
the value today of discovering the medical device, assuming you sell it for $280,000 in (a) two years, (b) three years, or (c) four years?
Note: Use tables, Excel, or a financial calculator. Round your answers to 2 decimal places. (FV of $1, PV of $1, FVA of $1, and PVA of
$1)
a.
b.
C.
Payment
Amount
$ 280,000
280,000
280,000
Interest
Rate
8%
8%
8%
Compounding
Annually
Annually
Annually
Period Due
2 years
3 years
4 years
Present
Value
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