Consider a five-year fixed - payment security that has a present value of $1,500. If the annual rate of discount is 2 percent, the payment made at the end of each year is Question 9 Select one: a. $231.77. b. $288.24.c. S 300.00. d. $310.00.

Consider a five-year fixed - payment security that has a present value of $1,500. If the annual rate of discount is 2 percent, the payment made at the end of each year is Question 9 Select one: a. $231.77. b. $288.24.c. S 300.00. d. $310.00.

Essentials Of Investments

11th Edition

ISBN:9781260013924

Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Chapter1: Investments: Background And Issues

Section: Chapter Questions

Problem 1PS

See similar textbooks

Related questions

Q: In the following ordinary annuity, the interest is compounded with each payment, and the payment is…

A: Monthly deposit can be calculated using PMT function in excel. PMT(rate, nper, pv, [fv], [type])…

Q: This problem demonstrates the dependence of an annuity's present value on the size of the periodic…

A: Present value is what a sum of money in the future is worth in today’s dollars at a rate of…

Q: An annuity pays $14 per year for 45 years. What is the future value (FV) of this annuity at the end…

A: > Given:> Rate of interest per annum = 9%> Amount of each deposit = 14> Number of years…

Q: For each of the following annuities, calculate the annuity payment. Note: Do not round intermediate…

A: Annuity payment refers to the amount that is paid at every period including interest and principal…

Q: uity X and Y provide the following payments: End of Year Y 1-10 1 K 11-20 2 21-30 1 K Annuity X and…

A: Annuity is a stream of constant regular payments.

Q: Find the present value of an annuity due of 600 per annum payable semiannually for 5 years (i.e. 300…

A: Present value of annuity due can be calculated as: = Annuity payment * (1+PVAF (i%, n-1 periods))

Q: Find the periodic payment for the following simple annuity due. Future Value Present Value $20,300…

A: Solution:- When an equal amount is paid each period at beginning of period, it is known as annuity…

Q: What is the future value annuity due of RM34,560 for the next 10 years with a discount rate of 12%?…

A: Using the FV function in excel

Q: What is the PV of an ordinary annuity with 10 payments of $7,800 if the appropriate interest rate is…

A: Present value of ordinary annuity is computed as follows:-PV= A*wherePV= Present value of ordinary…

Q: What is the PV of an annuity due with 5 payments of $5,700 at an interest rate of 6.1%? a.…

A: The objective of the question is to calculate the present value (PV) of an annuity due. An annuity…

Q: Given an interest rate of 8.5 percent per year, what is the value at date t= 8 of a perpetual stream…

A: As per the given question:Interest rate = R= 8.5%Payment= P= $1,900Number of years= T= 14The value…

Q: What is the present value of annuity of OMR 14000 for 8 years and discounting at 8% Select one: a.…

A: Annuity(P) = OMR 14000 Years(n) = 8 Discount rate(r) = 8%= 0.08 Therefore Present Value =…

Q: Given an interest rate of 9 percent per year, what is the value at date t-6 of a perpetual stream of…

A: Interest rate (i) = 0.09 Annual payment (C) = $1200 Period from year 6 to 14 (n) = 8 Value at t6 = ?…

Q: Find the value of the ordinary annuity at the end of the indicated time period. The payment R,…

A: The quarterly payment is $750. The annual rate of return is 5.1%. The maturity is five years.…

Q: s: Solve edch fhe follOwing Find the present value and the amount of Future value of the general…

A: Present Value/Future Value: It is the current value of a future sum of money at a specified rate…

Q: NPV Simes Innovations, Inc., is negotiating to purchase exclusive rights to manufacture and market a…

A: “Since you have posted a question with multiple sub-parts, we will solve first three sub-parts for…

Q: What is the present value of a 3 year, $3,000 per year annuity at 3 percent? Select one: a. $8,590…

A: The present value of an annuity is the current value of a series of equal payments to be made or…

Q: You receive annual payments of $4,800 at the beginning of each year for 7 years. The discount rate…

A: The total value of yearly payments at a particular date in future for a given discount rate is…

Q: What is the present value of a $500 ordinary annuity at an interest rate of 6% for 5 years? Select…

A: The present value of annuity refers to the current value of a series of future payments. The present…

Q: Assume you make a deposit of $7,500 now into a saving account that pays 12% per year, compounded…

A: Interest refers to the amount charged by the lender on the lent amount. The borrower of the loan is…

Q: Use Table 12-1 to calculate the future value (in $) of the ordinary annuity. (Round your answer to…

A: Annuity payment = $ 7500 Payment = Semi annually Period = 5 Years Semi annual period = 5*2 = 10…

Q: Find the future value for the constant growth annuity where the rate of growth is 0.75%, the…

A: Concept. FV = A [(1+r)n - (1+g)n ] ÷ ( r-g) Where , FV = future value A = timely payment r =…

Q: Find the present value of the decreasing annuity necessary to fund a withdrawal of $1,500 per…

A: The annuity payout provides information that with the regular withdrawals, what would be the…

Q: Use the ordinary annuity formula shown to the right to determine the accumulated amount in the…

A: An annuity is a payment series where the holder gets a fixed amount in return for a lump sum…

Q: Given a discount rate of 8%, what is the present value of a quarterly perpetual annuity payment of…

A: We can determine the PV of perpetuity using the formula below:Quarterly interest rate = 8%/4 = 2%

Q: If the present value of an ordinary. 7-year annuity is $6,500 and interest rates are 75 percent,…

A: The present value of annuity due is simply calculated as the present value of ordinary annuity…

Q: For the following ordinary annuity, determine the size of the periodic payment Present Future Value…

A: Future value (FV) = $16,800 Quarterly interest rate (r) = 0.02075 (i.e. 0.083 / 4) Quarterly period…

Q: Find the payment made by the ordinary annuity with the given present value. $237,277; quarterly…

A: The value of future cash flows today is called present value. The formula for the payment is given…

Q: What is the present value of a $1,340 per year annuity for five years at an interest rate of 12…

A: The interest rate represents the percentage of the principal amount either charged for borrowing or…

Q: Find the PV of a 26-year annuity-immediate with payments of 1, 2, 3, ..., 26 at an annual effective…

A: Present value is the current worth of the future payments at a given rate of return.

Q: Plan X: $50,000 Payments at the end of every year for 30 years. Plan Y: $50,000 Payments at the…

A: We have an annuity due and an annuity immediate. We have to find their PVs and FVs and then compare.

Q: Compute the future value

A: Future value of ordinary annuities refers to the value of payments at a specified future date in…

Q: A 10-year floating rate (annually paid) security selling for 101.32 pays a rate based on a reference…

A: A 10-year floating rate (annually paid) security selling for 101.32 pays a rate based on a reference…

Q: a. Use the appropriate formula to find the value of the annuity. b. Find the interest. Rate Time…

A: Future value The value of a financial asset at some time in the future is known as the future value…

Q: What is the present value of an annuity that pays $58 per year for 13 years and an additional $1,000…

A: PMT = 58 Period = 13 years Nominal rate of interest = 7.23% Additional amount = 1000

Q: Solve for the FVA or PVA value of the following annuity DUEs; Solve for… Payment amt #Pmts/year…

A: As per the Honor code of Bartleby we are bound to given the answer of first three sub part only,…

Q: $11,000 annually at 5% for 10 years.

A: The present value of annuity can be calculated by using the EXCEL PV function. The same is as…

Q: What is the future value of a $500 ordinary annuity at an interest rate of 6% for 5 years? Select…

A: We need to use future value of ordinary annuity(payment due at end) formula for solving this…

Q: a. Calculate the present value of the annuity assuming that it is (1) An ordinary annuity, b.…

A: Annuity refers to a constant and fixed stream of payments or cash flows. In case of ordinary annuity…

Q: esent value of an annuity of $1 ½/2% 0.9950 1.9851 2.9702 3.9505 4.9259 riod 1 2 3 4 5 6 7 8 9 10 11…

A: Present value of annuity is the equivalent amount based on the future cash flow and interest rate…

Q: Consider a 30-year, fixed-rate mortgage for $120,000 at a nominal rate of 6% with monthly payments.…

A: Loan amount(PV)=$120,000 Duration (n)=30*12=360 periods Rate per period(i)=0.0612=0.005 Monthly…

Q: to determine the accumulated amount in the annuity. Periodic Deposit Rate Time $4000 at the end of…

A: We need to use future value of ordinary annuity formula to solve this problem A =P1+rnnt -1rn Where…

Q: Find the future value for the ordinary annuity with the given payment and interest rate. PMT = $700;…

A: Ordinary Annuity is a sequence of regular payments made at the end of each period which can be…

Q: Individual Assessment 1.b: Simple Annuity Due Directions: Calculate the future value of #1 & 2 and…

A: The Future Value of Annuity Due is the total future value of each cash flow which is made at the…

Q: Annuity Review Problem: You are buying a perpetuity-immediate that makes annual payments X, X + 1, X…

A: Annuity is series of equal uniform payments that are paid at equal intervals and are in orderly…

Question

Consider a five-year fixed - payment security that has a
present value of $1,500. If the annual rate of discount is
2 percent, the payment made at the end of each year is
Question 9 Select one: a. S231.77. b. $288.24. c. S
300.00. d. $310.00.

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

SEE SOLUTION Check out a sample Q&A here

Step 1: Formula

VIEW

Step 2: calculation

VIEW

Solution

VIEW

Step by step

Solved in 3 steps with 6 images

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

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

contract would you prefer? 4. What are the present values of the following cash flows? A. $1,000 to be received in 8 years if the discount rate is 5 percent. B. $35 a year for 7 years compounded annually at 7 percent. C. a $100 perpetuity discounted at 9 percent.
question 6
What is the PV of an ordinary annuity with 10 payments of $6,600 if the appropriate interest rate is 5.5%? Select the correct answer. a. $49,766.03 b. $49,754.23 c. $49,771.93 d. $49,760.13 e. $49,748.33
8a. Compute the future value of a $100 annual annuity for the same combination of rates and time periods: (Round your answers to the nearest cent. Round FVA factors to 4 decimal places.) a. r = 8%, t = 10 years FV of annuity $ b. r = 8%, t = 20 years FV of annuity $ c. r = 4%, t = 10 years FV of annuity $
What is the PV of an ordinary annuity with 5 payments of $3,900 if the appropriate interest rate is 4.9%? a. $20,455.50 b. $19,858.66 c. $16,931.74 d. $17,761.39 e. $13,861.39
Use Table 12-1 to calculate the future value (in $) of the annuity due. (Round your answer to the nearest cent.) AnnuityPayment PaymentFrequency TimePeriod (years) NominalRate (%) InterestCompounded Future Valueof the Annuity $500 every 6 months 11 10 semiannually
What is the Present Value (PV) of a 2-year $400 Annuity Due if the annual interest (discount) rate is 8%? Please draw a timeline to visualize the problem. Use "." to form a time interval, e.g. 0.................1.................2.................3 (calculate first sentence and provide timeline)
F1. Please answer fast
Find the future value of the following ordinary simple annuity. Periodic Payment Interval Payment Term 3.25 years Interest Rate 6% Conversion Period quarterly $791.00 1 quarter The future value is S (Round the final answer to the nearest cent as needed. Round all intermediate values to six decimal places as needed)
Find the periodic payment for each of the following scenarios, where m is the periodic deposit and r is the interest rate. Future compounding time periodic interest in Value frequency deposit (m) earned years $ $200,000 5% annually 10 12.5779 15905.29 $ $250,000 7.8% semiannually 11 34.6003 7225.43 $ $125,000 3.7% quarterly 15 120.3921 1038.46 $ $ $225,000 3% monthly 15 $ $175,000 7.5% weekly 12 A
Use the following 8% interest factors to answer the question below: Future Value of Ordinary Annuity. 8.92280 10.63663 12.48756 What amount should be recorded as the cost of a machine purchased December 31, 2023, which is to be financed by making 8 annual payments of $10,000? Each payment is made at the end of the period. The applicable interest rate is 8%. Present Value of Ordinary Annuity. 5.2064 5.7466 6.2469 7 periods 8 periods 9 periods hs
7b. Compute the present value of a $100 annual annuity for the following combination of rates and time periods: (Round your answers to the nearest cent. Round PVA factors to 4 decimal places.) d. r = 4%, t = 20 years PV of annuity $

SEE MORE QUESTIONS

Recommended textbooks for you

Essentials Of Investments

Finance

ISBN:

9781260013924

Author:

Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:

Mcgraw-hill Education,

FUNDAMENTALS OF CORPORATE FINANCE

Finance

ISBN:

9781260013962

Author:

BREALEY

Publisher:

RENT MCG

Financial Management: Theory & Practice

Finance

ISBN:

9781337909730

Author:

Brigham

Publisher:

Cengage

Foundations Of Finance

Finance

ISBN:

9780134897264

Author:

KEOWN, Arthur J., Martin, John D., PETTY, J. William

Publisher:

Pearson,

Fundamentals of Financial Management (MindTap Cou…

Finance

ISBN:

9781337395250

Author:

Eugene F. Brigham, Joel F. Houston

Publisher:

Cengage Learning

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

Essentials Of Investments

Finance

ISBN:

9781260013924

Author:

Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:

Mcgraw-hill Education,

FUNDAMENTALS OF CORPORATE FINANCE

Finance

ISBN:

9781260013962

Author:

BREALEY

Publisher:

RENT MCG

Financial Management: Theory & Practice

Finance

ISBN:

9781337909730

Author:

Brigham

Publisher:

Cengage

Foundations Of Finance

Finance

ISBN:

9780134897264

Author:

KEOWN, Arthur J., Martin, John D., PETTY, J. William

Publisher:

Pearson,

Fundamentals of Financial Management (MindTap Cou…

Finance

ISBN:

9781337395250

Author:

Eugene F. Brigham, Joel F. Houston

Publisher:

Cengage Learning

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