The present worth of income from an investment that follows an arithmetic gradient is projected to be $475,000. The income in year one is expected to be $25,000. What is the gradient each year through year 6 at an interest rate of 10% per year?
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The present worth of income from an investment that follows an arithmetic gradient is projected to be $475,000. The income in year one is expected to be $25,000. What is the gradient each year through year 6 at an interest rate of 10% per year?
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- Towson Industries is considering an investment of $256,950 that is expected to generate returns of $90,000 per year for each of the next four years. What Is the Investments internal rate of return?The present worth of income from an investment that follows an arithmetic gradient was projected to be P 475,000. Ifthe income in year one is expected to be P 25,000, how much would the gradient have to be in each year through year 8 if the interest rate is 10% per year?A new investment is expected to return $15,000 per year, starting from next year (t=1) for ten periods (i.e., from t=1 to t=10). Thus, the sum of the expected returns over those periods is $150,000. How much is the sum of the present value of the expected return over those periods, assuming that the annual interest rate is 5%?
- An investment of $70,000 yields a net annual income of $15,000 for 6 years. What is the internal rate of return (IRR) for this investment?An investment of $185,575 is expected to generate returns of $65,000 per year for each of the next four years. What is the investment’s internal rate of return? Below is a table for the present value of $1 at compound interest. Year 6% 10% 12% 15% 1 0.943 0.909 0.893 0.870 2 0.890 0.826 0.797 0.756 3 0.840 0.751 0.712 0.658 4 0.792 0.683 0.636 0.572 5 0.747 0.621 0.567 0.497 Below is a table for the present value of an annuity of $1 at compound interest. Year 6% 10% 12% 15% 1 0.943 0.909 0.893 0.870 2 1.833 1.736 1.690 1.626 3 2.673 2.487 2.402 2.283 4 3.465 3.170 3.037 2.855 5 4.212 3.791 3.605 3.353 fill in the blank 1 %Suppose that you have an investment that earns 0% in the first year, but 20.7% in the second year. What rate of interest, compounded annually, would yield the same return after two years? (Answer in percentage)
- You are looking at an investment that has an effective annual rate of 14 percent. (show answers and excel formula equations) a. What is the effective semiannual return? b. What is the effective quarterly return? c. What is the effective monthly return?An investment, which is worth $54,000.00 and has an expected return of 11.80 percent, is expected to pay fixed annual cash flows for a given amount of time. The first annual cash flow is expected in 1 year from today and the last annual cash flow is expected in 6 years from today. What is the present value of the annual cash flow that is expected in 3 years from today? O $10,516.47 (plus or minus 10 dollars) O $13,059.88 (plus or minus 10 dollars) O $9,345.74 (plus or minus 10 dollars) O $11,681.46 (plus or minus 10 dollars) O none of the answers are within 10 dollars of the correct answer +An investment is expected to generate cash flows of $20,000 next year (at time t=1), and $10,000 in two years at time t=2. After that, the annual cash flows generated by the investment will decrease forever at growth rate of -8% APR compounded annually. What is the present value of this stream of cash flows if r = 10% APR compounded annually? Use a financial calculator or excel.
- What is the present value of an investment that will pay $1,000 in one year's time, and $1,000 every year after that, when the interest rate is 8%?An investment of $100 produces rate of return as followsIn year 1: a gain of 10 percentIn year 2: a loss of 5% percentIn year 3: a loss of 8 percentIn year 4: a gain of 3 percent.Calculate the value of the investment at the end of the fourth year and calculate the mean annual rate of return.What is the dollar-weighted return on a $100 investment that generates annual returns of $20, $15, $10, and $130, respectively in four years?