Explain why the present value of a cash flow stream, and the asset associated therewith; fluctuate...

Explain why the present value of a cash flow stream, and the asset associated therewith; fluctuate in value with the level of interest rates in the capital markets.

2. List and explain the points of financial impact on a company if it raises the credit standards required of its customers who utilized trade credit offered by the

company.

Define Weighted Average Cost of Capital and explain why a company must earn at least its Weighted Average Cost of Capital on new investments. What are the financial implications if it does not?

Expert Solution

jeff jeffy answered 6 months ago

What is the present value and future value of the following cash flow stream at a...

What is the present value and future value of the following cash flow stream at a rate of 8.00%? Years: 0 1 2 3 4 CFs: $0 $75 $225 $0 $500

What is the Net Present Value of the following cash flow stream? Year Cash Flow 0...

What is the Net Present Value of the following cash flow stream? Year Cash Flow 0 -$489 1 $363 2 $192 3 $161 4 $256 Assume an interest rate of 13% Note: Enter your answer rounded off to two decimal points. Do not enter $ or comma in the answer box. If your answer is negative, enter your answer as a negative number rounded off to two decimal points.

What is the present value of the following cash flow stream at a rate of 3.0%...

What is the present value of the following cash flow stream at a rate of 3.0% per year? Year 0: $0, Year 1: $75, Year 2: $225, Year 3: $0, Year 4: $300

What is the present value of the following cash flow stream at a rate of 7.0%...

What is the present value of the following cash flow stream at a rate of 7.0% per year? cash flow stream : 0=0$ 1=$75 2=$225 3=$0 4=$300 years and CF'S

What is the present value of the following cash-flow stream if the interest rate is 4%?...

What is the present value of the following cash-flow stream if the interest rate is 4%? You receive 650 at the end of first year, 900 at the end of second year, and 260 at the end of third year. (4% is annual interest rate and given annual compounding) [Please round your answer to the nearest whole number]

2. A) What is the present value of a cash flow stream of $10,000 per year...

2. A) What is the present value of a cash flow stream of $10,000 per year at an interest rate of 6% starting one year from today and goes on forever? B) What is the present value of a cash flow stream of $10,000 per year starting one year from today that grows at 3% at an interest rate of 6% starting one year from today and goes on forever? C) What is the present value of a cash flow...

1. Find the present value of the following cash flow stream with an interest rate of...

1. Find the present value of the following cash flow stream with an interest rate of 7%: Year 1 = $2,000 Year 2 = $4,000 Year 3 = $1,000 Year 4 = $6,000 2. Find the present value of the following ordinary annuity: $800 per year for 10 years at 6% 3. If you invest $5,000 in an investment which has an annual return of 10% but compounds every 6 months (instead of yearly), how much will it have after...

Find the present value of the following cash flow stream if the discount rate is 7.17%:...

Find the present value of the following cash flow stream if the discount rate is 7.17%: CF1 = 24, CF2 = 41, CF3 = 51, CF4 = 69. The cash flows are received at the end of each year. Round to the nearest $0.01 (e.g., if your answer is $175.386, record it as 175.39).

1. Find the present value as of year 0 of the following cash-flow stream if investments...

1. Find the present value as of year 0 of the following cash-flow stream if investments of similar risk are yielding 8% Year Cash Flow 0 through 14 $8,000 per year in each of those years 2. Find the present value as of year 0 of the following cashflow stream if investments of similar risk are yielding 8.25% Year Cash Flow 6 through 28 $8,000 per year in each of those years

What is the present value of the following uneven cash flow stream? The appropriate interest rate...

What is the present value of the following uneven cash flow stream? The appropriate interest rate is 5.6%, compounded annually. Note that the final cash flow represents a project where there may be reclamation or other “end of project” costs which are greater than any final income and/or salvage value. What annual interest rate will cause $2,750 to grow to $4,200 in 5 years, assuming annual compounding? Show your answer to 2 decimals (x.xx%) Will the future value be larger...

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