Calculate the Present Value of the Annuity of receiving $5,000 each year for the next 12 years
Question:
Calculate the Present Value of the Annuity of receiving $5,000 each year for the next 12 years with an interest rate of 7%. 8 Calculate the Future Value of the Annuity of investing $6,000 each year starting now for 10 years at a 5% interest rate. 9 How much would you pay today to receive $15,000 in 8 years? Assume a 5% interest rate.
10 How much would your CD of $1,000 be worth in 6 years at an interest rate of 4%?
11 How much would you pay today for an investment in which you would receive $5,000 each year for the next 7 years? Assume an interest rate of 6%.
12 If you save $10,000 per year for 4 years assuming an interest rate of 7%, how much money would you have?
13 Suppose you win a small lottery. You can receive $9,000 now or you can receive $2,100 a year for the next 5 years. Assume a 6% interest rate. Which method would be the best choice?
14 Calculate the effective annual rate of 12% assuming quarterly compounding.
Fundamentals of Corporate Finance
ISBN: 978-0133400694
1st canadian edition
Authors: Jonathan Berk, Peter DeMarzo, Jarrad Harford, David A. Stangeland, Andras Marosi