Calculate the present value of a $636 cash flow that is expected to be received in 5
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- Calculate the present value of a $636 cash flow that is expected to be received in 5 years from now. Assume a 10% APR interest rate that is compounded quarterly. Enter final answer using two decimal places.
- A zero coupon bond (coupon rate=0%) has five years to maturity. Its yield to maturity is 4.4%(assume annual compounding) and its face value is 1,000. If interest rates(and bond YTM) suddenly go down by 60 basis points (.6 percent of 1%) what is the predicted price of the bond immediately after the rate drop using the duration approximation?
- A perpetuity promises to make an infinite number of annual payments. Each payment will be $200 and the first payment will occur in 5 years from today. If the interest rate is 10%, what is the value of the perpetuity today? Round final answer two decimal places.
- An annuity promises to make 10 annual payments of $100. The first payment will be received 15 years from today. If the interest rate is 6%, what is the value of the annuity at the time of its last payment (24 years from today)? Round to two decimal places.
Related Book For
Financial and Managerial Accounting the basis for business decisions
ISBN: 978-1259692406
18th edition
Authors: Jan Williams, Susan Haka, Mark Bettner, Joseph Carcello
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