Explanation Given: Present value $10,606, Annuity payment $2,000, Time period10. Calculation: The interest rate can be calculated as given formula. Present value = EAP [ ( 1 + Interest ) Time period − 1 Interest ( 1 + Interest ) Time period ] (1) Substitute the interest rate as 13% and other respective values in equation (1) to calculate interest rate. 10 , 606 = $ 2000 [ ( 1 + 0.13 ) 10 − 1 0.13 ( 1 + 0.13 ) 10 ] 10 , 606 = $ 2 , 000 ( 3.394567 ) − 1 0.441294 $ 10 , 606 = $ 2 , 000 ( 2.394567 0.441294 ) $ 10 , 606 = $ 2 , 000 × 5

Principles of Managerial Finance (14th Edition) (Pearson Series in Finance)

14th Edition

ISBN: 9780133507690

Author: Lawrence J. Gitman, Chad J. Zutter

Publisher: PEARSON

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Chapter 5, Problem 5.54P

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To calculate: Interest rate.

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Chapter 5, Problem 5.53P

Chapter 5, Problem 5.55P

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Chapter 5 Solutions

Principles of Managerial Finance (14th Edition) (Pearson Series in Finance)

Ch. 5.1 - What is the difference between future value and...Ch. 5.1 - Define and differentiate among the three basic...Ch. 5.2 - Prob. 5.3RQ Ch. 5.2 - Prob. 5.4RQ Ch. 5.2 - Prob. 5.5RQ Ch. 5.2 - Prob. 5.6RQ Ch. 5.2 - Prob. 5.7RQ Ch. 5.3 - What is the difference between an ordinary annuity...Ch. 5.3 - What are the most efficient ways to calculate the...Ch. 5.3 - How can the formula for the future value of an...

Ch. 5.3 - Prob. 5.13RQ Ch. 5.3 - Prob. 5.14RQ Ch. 5.4 - How do you calculate the future value of a mixed...Ch. 5.5 - What effect does compounding interest more...Ch. 5.5 - Prob. 5.21RQ Ch. 5.5 - Differentiate between a nominal annual rate and an...Ch. 5.5 - Prob. 1FOE Ch. 5.6 - Prob. 1FOP Ch. 5.6 - How can you determine the size of the equal,...Ch. 5.6 - Prob. 5.27RQ Ch. 5.6 - How can you determine the unknown number of...Ch. 5 - Learning Goals 2, 5 ST5-1 Future values for...Ch. 5 - Prob. 5.3STP Ch. 5 - Learning Goal 6 ST5-4 Deposits needed to...Ch. 5 - Assume that a firm makes a 2,500 deposit into a...Ch. 5 - Prob. 5.2WUE Ch. 5 - Prob. 5.3WUE Ch. 5 - Your firm has the option of making an investment...Ch. 5 - Joseph is a friend of yours. He has plenty of...Ch. 5 - Jack and Jill have just had their first child. If...Ch. 5 - Prob. 5.1P Ch. 5 - Learning Goal 2 P5-2 Future value calculation...Ch. 5 - Prob. 5.3P Ch. 5 - Prob. 5.4P Ch. 5 - Prob. 5.5P Ch. 5 - Learning Goal 2 P5- 6 Time value As part of your...Ch. 5 - Learning Goal 2 P5-7 Time value you can deposit...Ch. 5 - Learning Goal 2 P5-8 Time value Misty needs to...Ch. 5 - Prob. 5.9P Ch. 5 - Prob. 5.10P Ch. 5 - Prob. 5.11P Ch. 5 - Prob. 5.12P Ch. 5 - Prob. 5.13P Ch. 5 - Prob. 5.14P Ch. 5 - Prob. 5.15P Ch. 5 - Prob. 5.16P Ch. 5 - Cash flow investment decision Tom Alexander has an...Ch. 5 - Learning Goal 2 P5-18 Calculating deposit needed...Ch. 5 - Future value of an annuity for each case in the...Ch. 5 - Present value of an annuity Consider the following...Ch. 5 - Prob. 5.21P Ch. 5 - Learning Goal 3 P5-22 Retirement planning Hal...Ch. 5 - Learning Goal 3 P5-23 Value of a retirement...Ch. 5 - Prob. 5.24P Ch. 5 - Learning Goal 2, 3 P5-25 Value of an annuity...Ch. 5 - Prob. 5.26P Ch. 5 - Prob. 5.27P Ch. 5 - Prob. 5.28P Ch. 5 - Prob. 5.29P Ch. 5 - Prob. 5.30P Ch. 5 - Prob. 5.31P Ch. 5 - Prob. 5.32P Ch. 5 - Prob. 5.33P Ch. 5 - Prob. 5.34P Ch. 5 - Prob. 5.35P Ch. 5 - Prob. 5.36P Ch. 5 - Prob. 5.37P Ch. 5 - Prob. 5.38P Ch. 5 - Prob. 5.39P Ch. 5 - Prob. 5.40P Ch. 5 - Learning Goals 3, 5 P5-42 Annuities and...Ch. 5 - Prob. 5.42P Ch. 5 - Prob. 5.43P Ch. 5 - Prob. 5.44P Ch. 5 - Prob. 5.45P Ch. 5 - Prob. 5.46P Ch. 5 - Prob. 5.47P Ch. 5 - Loan amortization schedule Joan Messineo borrowed...Ch. 5 - Prob. 5.49P Ch. 5 - Prob. 5.50P Ch. 5 - Prob. 5.51P Ch. 5 - Prob. 5.52P Ch. 5 - Prob. 5.53P Ch. 5 - Prob. 5.54P Ch. 5 - Prob. 5.55P Ch. 5 - Prob. 5.56P Ch. 5 - Prob. 5.57P Ch. 5 - Number of years needed to acccumulate a future...Ch. 5 - Prob. 5.59P Ch. 5 - Prob. 5.60P Ch. 5 - Time to repay Installment loan Mia Saito wishes to...Ch. 5 - Prob. 5.62P

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