Chapter 5 Assignment i Help Save & Exit Submit Imprudential, Inc., has an unfunded pension liability of $576 million that must be paid in 25 years. To assess the value of the firm's stock, financial analysts want to discount this liability back to the present. If the relevant discount rate is 6.9 percent, what is the present value of this liability? (Do not round intermediate calculations and enter your answer in dollars, not millions, rounded to 2 decimal places, e.g., 1,234,567.89) points Present value eBook Hint Print References Suppose the government decides to issue a new savings bond that is guaranteed to double in value if you hold it for 16 years. Assume you purchase a bond that costs $75. points a. What is the exact rate of return you would earn if you held the bond for 16 years until it doubled in value? (Do not round Intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) b. If you purchased the bond for $75 in 2017 at the then current interest rate of 21 percent year, how much would the bond be worth in 2025? (Do not round Intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) c. In 2025, instead of cashing in the bond for its then current value, you decide to hold the bond until it doubles in face value in 2033. What annual rate of return will you earn over the last 8 years? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) eBook in the bonen 2033. Wediate ca 216.) Print References Do not round inter what annual rate of co.decide to hold Rate of return b Value of bond c. Rate of return Chapter 5 Assignment Saved Help Save & Exit Submit Assume the total cost of a college education will be $300,000 when your child enters college in 18 years. You presently have $63,000 to invest. What annual rate of interest must you earn on your investment to cover the cost of your child's college education? (Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) points Annual rate of interest obook Hint Peint References Chapter 5 Assignment Seved Help Save & Exit Submit For each of the following, compute the future value: (Do not round intermediate calculations and round your answers to 2 decimal places, e.g., 32.16.) Interest Rate Future Value 13% points Present Value Years 2,150 11 8,5527 74,355 14 181,796 8 eBook 6 Hint Print References Chapter 5 Assignment Seved Help Save & Exit Submit Solve for the unknown number of years in each of the following (Do not round Intermediate calculations and round your answers to 2 decimal places, e... 32.16.): Years Interest Rate Present Value 600 850 18,800 21,900 Future Value 1,393 2,330 367,247 382,983 points 14 eBook Hunt Print References Chapter 5 Assignment i Served Help Save & Exit Submit You expect to receive $26,000 at graduation in two years. You plan on investing it at 9.25 percent until you have $161,000. How long will you wait from now? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) points Period years eBook Print References Chapter 5 Assignment Saved Help Save & Exit Submit 7 Your coin collection contains 44 1952 silver dollars. If your grandparents purchased them for their face value when they were new, how much will your collection be worth when you retire in 2054, assuming they appreciate at an annual rate of 5.7 percent? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g.. 32.16.) points points Future value Book Print References Chapter 5 Assignment Saved Help Save & Exit Submit For each of the following compute the present value (Do not round intermediate calculations and round your answers to 2 decimal places, e.g.. 32.16.): Present Value Years Interest Rate 8% 14 15 Future Value $ 14,551 42,557 877,073 541,164 points 30 35 ebook Hint Print References Chapter 5 Assignment i Saved Help Save & Exit Submit First City Bank pays 8 percent simple interest on its savings account balances, whereas Second City Bank pays 8 percent interest compounded annually. If you made a $61,000 deposit in each bank, how much more money would you earn from your Second City Bank account at the end of 8 years? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) points Difference in accounts eBook References