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In: Finance
A rich aunt has promised you $2,810.00, one year from today. In addition, each year after...
A rich aunt has promised you $2,810.00, one year from today. In addition, each year after that , she has promised a payment (on the anniversary of the last payment) that is 4.00% larger than the last payment. She will continue to show this generosity for 25 years, giving a total of 25 payments. If the interest rate is 10.00%, what is her promise worth today?
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jeff jeffy answered 1 year agoRelated Solutions
A rich aunt has promised you $5000 one year from today. In addition, each year after...
A rich aunt has promised you $5000 one year from
today. In addition, each year after that, she
has promised you a payment (on the anniversary of the
last payment) that is 5% larger than the
last payment. She will continue to show this
generosity for 20 years, giving a total of 20 payments.
If the interest rate is 5%, what is her promise worth
today?
A rich aunt has promised you $6,000 one year from today. In addition, each year after...
A rich aunt has promised you $6,000 one year from today. In
addition, each year after that, she has promised you a payment
(on the anniversary of the last payment) that is 3% larger than
the last payment. She will continue to show this generosity for
20years, giving a total of 20 payments. If the interest rate is
9%, what is her promise worth today?
The present value of the aunt's promise is?
A rich aunt has promised you $3,000 one year from today. In addition, each year after...
A rich aunt has promised you $3,000 one year from today. In
addition, each year after that, she has promised you a payment
(on the anniversary of the last payment) that is 3% larger than
the last payment. She will continue to show this generosity for 20
years, giving a total of 20 payments. If the interest rate is 9%,
what is her promise worth today?
A rich aunt has promised you $3,000 one year from today. Inaddition, each year after that,...
A rich aunt has promised you $3,000 one year from today.
Inaddition, each year after that, she has promised you a
payment(on the anniversary of the last payment) that is 3% larger
than the last payment. She will continue to show this generosity
for 20 years, giving a total of 20 payments. If the interest rate
is 8%, what is her promise worth today?
A rich aunt has promised you $3,000 one year from today. In addition, each year after...
A rich aunt has promised you $3,000 one year from today. In
addition, each year after that, she has promised you a payment
(on the anniversary of the last payment) that is 2% larger than
the last payment. She will continue to show this generosity for
2020 years, giving a total of 2020 payments. If the interest rate
is 4%, what is her promise worth today?
A rich aunt has promised you $ 4000 one year from today. In addition, each year...
A rich aunt has promised you $ 4000 one year from today. In
addition, each year after that, she has promised you a payment
(on the anniversary of the last payment) that is 4 % larger than
the last payment. She will continue to show this generosity for
20myears, giving a total of 20 payments. If the interest rate is 4
% , what is her promise worth today?
Your rich aunt offers you the choice of 3 pay-outs today Choice 1 : $1000 paid...
Your rich aunt offers you the choice of 3 pay-outs today
Choice 1 : $1000 paid every year for 5 years, with the first
payment to be received at the end of year 3
Choice 2 : $300 paid today
Choice 3 : $80 paid at the end of each month for 5 years, with
the first payment to be received in a month
(a) What is the effective annual interest rate would make you
indifferent between choice 2 and...
You are promised $10,000 a year for six years after which you will receive $5,000 a...
You are promised $10,000 a year for six years after which you
will receive $5,000 a year for six years. If you can earn 8 percent
annually, what is the present value of this stream of payments?
Show how to solve in Excel, Step-By-Step
You are promised a cash flow every year forever! Next year you will receive $100. After...
You are promised a cash flow every year forever! Next year you
will receive $100. After that, the payment will grow by 1%
compounded annually. There is no risk associated with the payments.
You can invest and earn a risk-free rate of return of 5%. What is
the present value of the perpetuity?
Gabriela inherits money from her aunt. She gets $100,000 from her aunt, today. She have exactly...
Gabriela inherits money from her aunt. She gets $100,000
from her aunt, today. She have exactly 20 years to retire and she
decided to put the entire amount into 20 years, 4% annual interest
annuity.”
A. The answer to this problem is $219,112.31. A total
principle of $100,000.00 and total interest of
$119,112.31.
Show work with finance formulas like annuity step by
step for this problem to get this answer.
b.Next assume that in addition to this initial
$100,000, she...
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