You are offered a deal for purchasing a vehicle that requires you to pay $200 per...

You are offered a deal for purchasing a vehicle that requires you to pay $200 per month for the first year and payments of $400 per month during the second year. The APR is 18% and payments begin in one month. What is the present value of this 2-year loan?

Solutions

Expert Solution

jeff jeffy answered 1 year ago

Next > < Previous

Related Solutions

you are offered an annuity that will pay you $200,000 once per year, at the end...

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 investment that will pay you $ 25,000 per year for 10...

You are offered an annuity investment that will pay you $ 25,000 per year for 10 years beginning in 20 years. These payments will be made at the beginning of each year and your discount rate is expected to be 8%. You will need to make payments at the end of each year for the next 20 years (also at 8%) in order to receive the annuity investment. What is the present value of the annuity investment as of...

10. You are offered an annuity that will pay you $200,000 once per year, at the...

10. 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 is ?? = 5.25%, how much are you willing to pay for this annuity? (hint: this is the same as the present value of an annuity.) 11. You would like to develop an...

-Q- You are offered an annuity product that will pay you $36,000 per year for 20...

-Q- You are offered an annuity product that will pay you $36,000 per year for 20 years in retirement. If you believe the appropriate discount rate is 8%, then what is the annuity worth to you today? Round to the nearest 0.01.

You have been offered the opportunity to invest in a project that will pay $4,240 per...

You have been offered the opportunity to invest in a project that will pay $4,240 per year at the end of years one through three and $6,676 per year at the end of years four and five. These cash flows will be placed in a saving account that pays 10.03 percent per year. What is the future value of this cash flow pattern at the end of year five? please answer without CHARTS.

You have been offered the opportunity to invest in a project that will pay $2,310 per...

You have been offered the opportunity to invest in a project that will pay $2,310 per year at the end of years one through three and $10,109 per year at the end of years four and five. If the appropriate discount rate is 17.0 percent per year, what is the present value of this cash flow pattern? Round the answer to two decimal places.

You have been offered the opportunity to invest in a project that will pay $2,526 per...

You have been offered the opportunity to invest in a project that will pay $2,526 per year at the end of years one through three and $10,052 per year at the end of years four and five. If the appropriate discount rate is 12.2 percent per year, what is the present value of this cash flow pattern?

You have been offered the opportunity to invest in a project that will pay $4,155 per...

You have been offered the opportunity to invest in a project that will pay $4,155 per year at the end of years one through three and $8,519 per year at the end of years four and five. These cash flows will be placed in a saving account that pays 18.89 percent per year. What is the future value of this cash flow pattern at the end of year five?

You are considering purchasing a savings bond that will pay you $100 per year. The market...

You are considering purchasing a savings bond that will pay you $100 per year. The market interest rate currently is 5% per year. (a) If this savings bond is a perpetuity (paying the same amount forever), what its price (or present value)? (b) Suppose instead that the bond pays $100 per year for 20 years. What is its price in this case? (c) The interest rate goes up, to 8% per year. What will happen to the price of the...

Amy was offered two options for a car she was purchasing: Lease option: Pay lease amounts...

Amy was offered two options for a car she was purchasing: Lease option: Pay lease amounts of $400 at the beginning of every month for 6 years. At the the end of 6 years, purchase the car for $13,500. Buy option: Purchase the car immediately for $25,000. The money is worth 7.40% compounded monthly. a. What is the Discounted Cash Flow (DCF) for the lease option?

Subjects