A security promises to pay you $40 every six months for 10 years and at the end of year 10, it will pay you an additional $1,000. If you buy it at $1,100, what is the (annual) return on your investment?
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- You are investigating an investment opportunity. The security requires you to make monthly payments of $100 each ( 1^("st ") payment is 1 month from today), over the next 10 years. It offers a nominal annual return of 6% with quarterly compounding. What is the future value of this security at the end of its life (including all your payments and all interest)You purchase an annuity that will pay you $100 every three months for five years. The first $100 payment will be made as soon as you purchases the investment. If your required rate of return is 9% , how much should you be willing to pay for this investment? Group of answer choices $1,596.82 $1,632.29 $1,759.34 $1,510.46You want to invest $8,000 at an annual Interest rate of 8% that compounds annually for 12 years. Which table will help you determine the value of your account at the end of 12 years? A. future value of one dollar ($1) B. present value of one dollar ($1) C. future value of an ordinary annuity D. present value of an ordinary annuity
- You put $600 in the bank for 3 years at 15%. A. If Interest Is added at the end of the year, how much will you have in the bank after one year? Calculate the amount you will have in the bank at the end of year two and continue to calculate all the way to the end of the third year. B. Use the future value of $1 table In Appendix B and verify that your answer is correct.Use the following 10% present value factors: N 1: 0.9091 N = 2: 0.8264 N= 3: 0.7513 Assume you wish to receive $1,000 at the end of two years. Assuming an interest rate of 10% what amount would you need to deposit todayin order to receive the S1, 000? Round to the nearest penny if necessary.● An investment will provide you with $100 at the end of each year for the next 10 years. What is the present value of that annuity if the discount rate is 8% annually? • What is the present value of the above if the payments are received at the beginning of each year? • If you deposit those payments into an account earning 8%, what will the future value be in 10 years? • What will the future value be if you open the account with $1,000 today, and then make the $100 deposits at the end of each year?
- May I ask for an explanation and solution to the question for a better understanding. Thank you! 9. You expect to receive P1,000 at the end of each of the next 3 years. You will deposit these payments into an account which pays 10%, compounded semiannually. What is the future value of these payments, that is, the value at the end of the third year? a. P665.50 b. P7,986.00 c. P3,318.01 d. P3,993.00A perpetuity of $300 per year will begin 3 years from today. If the interest rate on this security is 8%, what would be its value or price TODAY? O A. $3750 B. $5825 Oc. $3215 O D. $9739What is the future value (at the end of 8 years) of an annuity that pays $700 a quarter over 8 years with the payments invested at 9.3% per annum (assume compounding matches payment periods, common assumption for such problems)? (enter your answer in the following format 123456.78) Answer: Check
- You are offered an annuity that will pay $14,000 per year for 13 years (the first payment will be made today). If you feel that the appropriate discount rate is 8%, what is the annuity worth to you today? $110,652.86 $300,934.15 $119.505.09 $325,008.88 $242,876.85 4.0What is the future value of an annuity due that promises $60,000 per year for 10 years if the appropriate interest rate is 4% in excel formulaGlobal Financial Management Rivier University Module 2 Problem Set TVM Directions: Using the financial functions of Excel, the Excel wizard and/or the formulas for TVM, solve each of the problems. Example A: You have $300,000 that you want to invest in a one year Certificate of Deposit (CD) with a 4% annual interest rate. What will be the value of that CD in a year? PV = $300,000.00 VYR = 4% N = Formula: FV = PV(1+1)^N = $312,000.00 Wizard (FV): $312,000.00 Excel Function: $312,000.00 Example B: What if the investment made above were held in a CD for 5 years, with the same principle and interest rate? PV = $300,000.00 VYR = 4% N = 5 Formula: FV = PV(1+1)^N = $364,995.87 Wizard (FV): $364,995.87 Excel Function: $364,995.87 Example C: For this scenario, lets assume that CDs are being offered for 5 years at a rate of 3%, 4% and 5%. Using the table function of Excel, create a table that shows the FV at 3%, 4% and 5% for 0, 1, 2, 3, 4, and 5 years. How to use the table function in Excel:…