(Amount of an ordinary annuity) How much must you pay at the end
of each year...
(Amount of an ordinary annuity) How much must you pay at the end
of each year to repay a $50,000, 14% annual interest rate loan if
you must make: Using excel
How much would you be willing to pay for a 10-year ordinary
annuity if the payments are $500 per year and the interest rate is
6.25% compounded annually ?
Your friend offers to pay you an annuity of $8,500 at the end of
each year for 3 years in return for cash today. You could earn 5.5%
on your money in other investments with equal risk. What is the
most you should pay for the annuity?
How much must be saved at the end of each year for the next 10
years in order to accumulate $50,000, if you can earn 9% annually?
Assume you contribute the same amount to your savings every
year.
$3,291.00 A
$3,587.87 B
$4,500.33 C
$4,587.79 D
you
are offered an annuity that will pay you $200,000 once per year, at
the end of the year, for 25 years. the first payment will arrive
one year from now. the last payment will arrive twenty five years
from now. suppose your annual discount rate i=17.25%, how much are
you willing to pay for this annuity? ( this is the same as the
present value of an annuity)
You are offered an annuity that will pay you 10,000 at the end
of each year for 20 years, with the first payment being in 10 years
from today. If the interest rate is 12% annually, what is this
annuity worth to you today?Martha receives $1000 on the first of each year. Stewart
receives $100 on the last day of each year. Both Martha and Stewart
will receive payments for 11 years. At an 8% discount rate, what is
the...
Exercice 4: a. A financial asset generates returns of $10,000 at the end of each year for ten years. The required rate of return if 7% per year. How much must you pay to buy this asset? b. A stock pays a constant dividend of $10, starting at the beginning of year 6 (t=6). What is the present value today of the perpetuity if the required rate of return is 20%?
a. You will receive an annuity payment of $1,200 at the end of
each year for 6 years. What will be the total value of this stream
of income invested at 7% by the time you receive the last
payment?
b. How many years of investing $1,200 annually at 9% will it
take to reach the goal of $12,000?
c. If you plan to invest $1,200 annually for 9 years, what rate
of return is needed to reach your goal...
Annuity payments are assumed to come at the end of each payment
period (termed an ordinary annuity). However, an exception occurs
when the annuity payments come at the beginning of each period
(termed an annuity due).
What is the future value of a 13-year annuity of $3,500 per
period where payments come at the beginning of each period? The
interest rate is 10 percent. Use Appendix C for an approximate
answer, but calculate your final answer using the formula and...
Annuity payments are assumed to come at the end of each payment
period (termed an ordinary annuity). However, an exception occurs
when the annuity payments come at the beginning of each period
(termed an annuity due).
What is the future value of a 10-year annuity of $2,600 per
period where payments come at the beginning of each period? The
interest rate is 7 percent. Use Appendix C for an approximate
answer, but calculate your final answer using the formula and...
How do you know if it is an annuity due or ordinary
annuity, if the question does not explicitly say payments start at
the beginning or the end of the year ? Also, how do you know which
one it is, if the question says "made a payment today, or
immediately" means it is an annuity due? (couldn't "today" be the
last day of the year)
17. Answer the following questions.
(a) On May 1, 2017, Goldberg Company sold some...