2. What is the present value of an investment that yields $5000 to be received in...
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2. What is the present value of an investment that yields $5000 to be received in eight years and $6000 to be received in 12 years. Assume the discount rate is 5%? 3. Regarding the present value of an annuity, a person is getting the benefit of an annuity from an insurance policy. Accordingly he wants to know what thousand dollars received at the end of each of the next 7 years is worth today. Assume a discount rate of 5%. 4. Amortized Loan example. Suppose a CEO wants to purchase a facility that makes bread. So he borrows $8000, to be repaid in eight equal payments at the end of each of the next eight years. Assume the interest rate that is paid to the lender is 15% on the outstanding portion of the loan. The CEO wants to calculate what the annual payments associated with the repayment of this debt will be. 2. What is the present value of an investment that yields $5000 to be received in eight years and $6000 to be received in 12 years. Assume the discount rate is 5%? 3. Regarding the present value of an annuity, a person is getting the benefit of an annuity from an insurance policy. Accordingly he wants to know what thousand dollars received at the end of each of the next 7 years is worth today. Assume a discount rate of 5%. 4. Amortized Loan example. Suppose a CEO wants to purchase a facility that makes bread. So he borrows $8000, to be repaid in eight equal payments at the end of each of the next eight years. Assume the interest rate that is paid to the lender is 15% on the outstanding portion of the loan. The CEO wants to calculate what the annual payments associated with the repayment of this debt will be.
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