Essentials Of Investments
Essentials Of Investments
11th Edition
ISBN: 9781260013924
Author: Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher: Mcgraw-hill Education,
Bartleby Related Questions Icon

Related questions

Q: You are expecting to receive the following payments: $7,000 in one year and $5,000 three years from…
A: Payment for Year 1 = p1 = $7000Payment for year 3 = p3 = $5000Discount Rate = r = 8%
Q: You expect to receive $100 at the end of each year that is a multiple of 2 or 3, so, for example,…
A: Annual amount = $100Number of years = Perpetual annuityDiscount rate = 10%To find: The value of the…
Q: Use graphical approximation techniques or an equation solver to approximate the desired interest…
A: Nominal rate:The nominal rate, in the realm of finance, refers to the stated or advertised interest…
Q: What is the value today of $1,500 per year, at a discount rate of 9 percent, if the first payment is…
A: The concept of money's time value reveals that any sum of money is worth more currently, than what…
Q: Calculate  time value of money : If I am to receive $10k in 5 years, given a 5% rate of return, what…
A: Time value of money helps the management for decision making. as the value of money, today is high…
Q: If interest rate is 10% per year, which one of the following annuities give maximum benefit and…
A: In the given question, different set of annuities having different time periods and amounts is…
Q: Find the present value of a 30 year annuity immediate with effective annual interest rate i = .03…
A: Present value refers to the current value of the cash flows or the annuity. Present value can be…
Q: Calculate future value if you save $50,000 with a 6% interest rate for seven years. You must show…
A: Future value refers to the value of the current asset on some future date affected due to inflation…
Q: What is the present value of $12.200 to be received 4 years from today if the discount rate is 5…
A: Given Information: Amount to be received in future=$12.200 Number of years=4 Discount Rate=5%
Q: Explain the nature of the potential lending losses associated with each of the following: default…
A:
Q: You are planning to deposit in saving account $25000 three years from now, $35000 in the fourth…
A: Time value of money concept says that an amount invested today will have more value in future due to…
Q: the discount rate is 7.6%, what would you be willing to pay for receiving a payment of $700 eve
A: Value of any annuity is the present value of cash flow from the annuity based on time and interest…
Q: You are given $200 each year starting next year and finishing in 15 years (t = 15). If the discount…
A: We need to use present value of annuity due formula to calculate present value of cash flows stream.…
Q: Which of the following will generate the greatest future sum of money, assuming other variables stay…
A: Assumed values: Assume: Amount Present value(PV) $2,500 Years(NPER) 5
Q: Find the present value of an annuity stream in which the first payment of $268 is received 8 years…
A: Payment = p $268Time = t = 8 Number of Payment = n = 8Growth Rate = g = -4.5%Discount Rate = r =…
Q: Find the NPV and PI of an annuity that pays $500 per year for eight years and costs $2,500. Assume a…
A: 1.NPV means Net present value.It is calculated as follows:-NPV = Present value of cash inflows -…
Q: If a person saves $62 a month by using coupons and doing comparison shopping, (a) what is the amount…
A: Future Value of Ordinary Annuity refers to the concept which determines the sum total of all the…
Q: You buy an annuity that will pay you $24,000 a year for 25 years.  What is the value of this annuity…
A: Present value of annuity = Annuity amount * PVA of $1
Q: Suppose that you want to take out a loan and that your local bank wants to charge you an annual real…
A: Compute the nominal interest rate: Nominal interest rate is calculated by using following formula:
Q: Suppose you will receive OMR 1 each year for the 3 coming year the Interest Rate is 10% Question:…
A: Calculation of future value annuity: Answer: Future value annuity is OMR 3.31
Q: Use a calculator to evaluate the present value of annuity formula. For the values of the variables…
A: Using financial calculator N (t) = 3*12 =36 I/Y (r)=5/12 = 0.4167 PMT (m) =50 FV =0
Q: Suppose you expect to receive periodic payments of $1,500 at the end of 3, 5, 7, and 10 years from…
A: Given information,Discount rate: Payment in period 3, 5, 7 and 10: To calculate,Present value of the…
Q: Use graphical approximation techniques or an equation solver to approximate the desired interest…
A: Annual Payment = p = $1000Time = t = 5 YearsFuture Value of Payment = fv = $5700.46
Q: You are comparing two annuities. Annuity A pays $115 at the end of each year for 5 years. Annuity B…
A: Time, value, and money refer to the money present today being more valuable than the money will…
Q: will receive $1000 two years from today, and at the end of each subsequent year, you will receive an…
A: In perpetuity there are payments forever and there is no break of the payments in perpetuity.
Q: Given the following information, calculate the rate of return. price = $501.88 time to maturity =…
A: price = $501.88time to maturity = 10 yearsannual payment = $100type = ordinary annuity
Question

Calculate the discount factor you would use to find the present value of an amount of money you will receive 8 years in the future, assuming a 3% interest rate.

Expert Solution
Check Mark
Introduction;

Interest rate (r) = 0.03 or 3%

Period (n) = 8 Years

Discount factor = ?

 

Discount factor is a decimal value to find out the present value of a cash flow to be received in future. Future cash flow will be multiplied by that discount factor to know the present value.

bartleby

Step by stepSolved in 2 steps

See solution
Check out a sample Q&A here
Blurred answer
Knowledge Booster
Background pattern image
Finance
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, finance and related others by exploring similar questions and additional content below.
Similar questions
Recommended textbooks for you
Text book image
Essentials Of Investments
Finance
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Mcgraw-hill Education,
Text book image
FUNDAMENTALS OF CORPORATE FINANCE
Finance
ISBN:9781260013962
Author:BREALEY
Publisher:RENT MCG
Text book image
Financial Management: Theory & Practice
Finance
ISBN:9781337909730
Author:Brigham
Publisher:Cengage
Text book image
Foundations Of Finance
Finance
ISBN:9780134897264
Author:KEOWN, Arthur J., Martin, John D., PETTY, J. William
Publisher:Pearson,
Text book image
Fundamentals of Financial Management (MindTap Cou...
Finance
ISBN:9781337395250
Author:Eugene F. Brigham, Joel F. Houston
Publisher:Cengage Learning
Text book image
Corporate Finance (The Mcgraw-hill/Irwin Series i...
Finance
ISBN:9780077861759
Author:Stephen A. Ross Franco Modigliani Professor of Financial Economics Professor, Randolph W Westerfield Robert R. Dockson Deans Chair in Bus. Admin., Jeffrey Jaffe, Bradford D Jordan Professor
Publisher:McGraw-Hill Education
SEE MORE TEXTBOOKS