Question
In: Finance
A lease on Times Square will pay $1,000,000 annually (starting in one year) for 25 years...
A lease on Times Square will pay $1,000,000 annually (starting in one year) for 25 years at a growth rate of 2%. Similar properties are discounted at a 5% rate. What is the value today (present value) of this growing annuity cash flow stream? (round to the nearest dollar)
Solutions
jeff jeffy answered 2 years agoRelated Solutions
You just purchased an annuity that will pay you $24,000 a year for 25 years, starting today....
You just purchased an annuity that will pay you $24,000 a year
for 25 years, starting today. What was the purchase
price if the discount rate is 8%?
$256,195
$251,409
$245,621
$276,690
$258,319
Kristi is considering an investment that will pay $7,500 a year for eight years, starting one...
Kristi is considering an investment that will pay $7,500 a year
for eight years, starting one year from today. How much should she
pay for this investment if she wishes to earn a 6% rate of return?
Provide complete calculations in your answer
Kristi was offered three (3) different assets, as listed
below:
Asset 1 pays annual interest rate of 9% compounding
annually.
Asset 2 pays annual interest rate of 8.9% compounding
semi-annually.
Asset 3 pays interest...
Refer to the following lease amortization schedule. The 10 payments are made annually starting with the...
Refer to the following lease amortization schedule. The 10
payments are made annually starting with the beginning of the
lease. Title does not transfer to the lessee and there is no
purchase option or guaranteed residual value. The asset has an
expected economic life of 12 years. The lease is
noncancelable.
Payment
Cash
Payment
Effective
Interest
Decrease
in balance
Outstanding Balance
69,952
1
10,000
10,000
59,952
2
10,000
5,396
4,604
55,348
3
10,000
4,981
5,019
50,330
4
10,000
4,530
5,470...
Refer to the following lease amortization schedule. The 10 payments are made annually starting with the...
Refer to the following lease amortization schedule. The 10
payments are made annually starting with the beginning of the
lease. Title does not transfer to the lessee and there is no
purchase option or guaranteed residual value. The asset has an
expected economic life of 12 years. The lease is
noncancelable.
Payment
Cash
Payment
Effective
Interest
Decrease
in balance
Outstanding Balance
101,385
1
15,000
15,000
86,385
2
15,000
8,639
6,361
80,024
3
15,000
8,002
6,998
73,026
4
15,000
7,303
7,697...
(Yield to maturity) Abner Corporation's bonds mature in 25 years and pay 14 percent interest annually....
(Yield to maturity) Abner Corporation's
bonds mature in 25 years and pay 14 percent interest annually. If
you purchase the bonds for $1,125, what is your yield to
maturity?
Your yield to maturity on the Abner bonds
is__% (Round to two
decimal places.)
(Bond valuation)The 8-year $1,000 par bonds
of Vail Inc. pay 8 percent interest. The market's required yield
to maturity on a comparable-risk bond is 11 percent. The current
market price for the bond is $920.
a. ...
Abner Corporation's bonds mature in 25 years and pay 7 percent interest annually. If you purchase...
Abner Corporation's bonds mature in 25 years and pay 7 percent
interest annually. If you purchase the bonds for $725, what is
your yield to maturity? (round to 2 decimal points)
What is the present value of 1,400 per year annually at the endof years 25...
What is the present value of 1,400 per year annually at the end
of years 25 to 43 if the interest rate is 7%14,082.7213,759.6414,469.832,852.682,594.73
You plan to retire in year 20 Your retirement will last 25 years starting in year...
You plan to retire in year 20
Your retirement will last 25 years starting in year 21
You want to have $50,000 each year of your retirement.
How much would you have to invest each year, starting in one year,
for 15 years , to exactly pay for your retirement ,if your
investments earn 6.00% APR (compounded annually)?
You will need $100,000 per year for 25 years starting in year 45. You are able to...
You will need $100,000 per year for 25 years starting
in year 45. You are able to save
$3000 per year from year 3 to year 15, inclusive. How
much must you save from years 16 through 37, inclusive, if
interest rates will be 4% from years 0 through the end of year
25 and 7% starting at the beginning of year 26 and
on? Solve for the unknown payments:
Please show work: I do not understand my professors work
You plan to retire in year 20 Your retirement will last 25 years starting in year...
You plan to retire in year 20
Your retirement will last 25 years starting in year 21
You want to have $50,000 each year of your retirement.
How much would you have to invest each year, starting in one year,
for 15 years , to exactly pay for your retirement ,if your
investments earn 6.00% APR (compounded annually)?
Answers:
$21,349
$21,546
$20,930
$20,520
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