Given an interest rate of 6.0 percent per year, what is the current value of a perpetual stream of $36,000 (annual payment) that begins 5 years from now?

Q: What is the present value of $1,000 paid at the end of each of the next 56 years if the interest…

A: Present value is the current worth of the amount deposited or received in future date.

Q: What monthly payment is required over 8 years to equate with a future amount P90,000? Assume…

A: Monthly payment refers to the amount which is paid on a periodic basis. The period of monthly…

Q: What is the present value of a stream of monthly payments of $500 each over 10 years, if the…

A: Monthly payment (P) = $500 Interest rate = 10% Monthly interest rate (r) = 10%/12 =…

Q: With a present value of $150,000, what is the size of the withdrawals that can be made at the end of…

A: We use PMT function in excel to calculate quarterly withdrawal

Q: You borrow $105,400 today at a 9 percent annual interest rate (compounding is annual) with repayment…

A: We need to use the concept of time value of money (TVM). According to TVM, money today is worth more…

Q: What is the future value of $2,500 deposited for one year earning a 14 percent interest rate…

A: In the given question we require to compute the future value of investment from following details:…

Q: Find the present value of $10,000 payable in 10 years if the interest rate is 5 percent per year…

A: Time value of money  Time value of money is a core principle of finance according to which money is…

Q: What is the present equivalent of $ 180,000 to be received in 15 years when the interest rate is 7%…

A: Time value of money (TVM) means that the amount of money received in the present period will…

Q: What amount will be paid at the beginning of every month for 10 years if the present value is 200,…

A: Payment at the beginning of every month = PV x r / [{1 - (1 + r)^(-n)} x (1 + r)] Here, PV = Present…

Q: What is the future equivalent of 10,000 per year that flows continously for 8.5 years if the nominal…

A: The following information has been provided in the question: Present value= 10000 per year Time =8.5…

Q: Suppose you were to receive $1,000 at the end of 10 years. If your opportunity rate is 10 percent,…

A: given, FV = $1000 N=10 R=10%

Q: What is the future value of $100 quarterly payments for 5 years assuming a 15% interest rate…

A: Convert 15% compounded monthly to its equivalent interest rate for quarterly interval. Here, 'R'…

Q: What is the future value in 12 years of $1,000 payments received at the beginning of each year for…

A: As a first step, let's gather all the information that question has to offer.Annuity investment = A…

Q: What is the present worth of P5000 deposited at the end of every three months for 5 years if the…

A: The present value is the value of the sum received at time 0. It is the current value of the sum…

Q: What is the present value of $10,000 to be received two years from today assuming an annual interest…

A: Present value: This is the amount of future value reduced or discounted at a rate of interest till…

Q: Suppose that you will receive annual payments of $16,500 for a period of 10 years. The first payment…

A: Present value is the current worth of the future payments to be made at a specific interest rate.…

Q: A series of equal quarterly payments of $10,000 for 15 years is equivalent to what future worth…

A: In this we require quarterly interest in each case to get future value.

Q: How much should be deposited now at 7 percent compounded annually to make possible withdrawals of…

A: A concept through which it is studied that the current worth of money is higher than its future…

Q: assume that you pay 10000 on a yearly basis for 10 years, how much will pay after ten years if the…

A: Given:Amount paid on yearly basis=10000Time period=10yearsInterest rate=5% compounded yearly

Q: Find the present value of a simple perpetuity of P10,000 payable semi-annually if the interest rate…

A: The formula to calculate the present value of the growing annuity is  Present value of annuity due=…

Q: What will be the future worth of series of 15 annual $100 payments if the nominal annual interest…

A: An interest rate method in which current interest is computed by multiplying the interest rate by…

Q: Suppose that an annuity will provide for 20 annual payments of 1440 dollars, with the first payment…

A: Total number of annual payments is 20 Annual payments $1440 First payment coming in 11 years from…

Q: What is the percent value of $2,725 per year, at a discount rate of 10%, if the first payment is…

A: The time value of money implies that the cash in hand at present has a higher value than the cash…

Q: A series of equal quarterly payments of $25,000for 10 years is equivalent to what future worthamount…

A: Future value (FV) is the value of a current asset at a future date based on an assumed rate of…

Q: What is the present value of $6,000 paid at the end of each of the next 65 years if the interest…

A: Annual payment (P) = $6000 Interest rate (r) = 7% Number of annual payments (n) = 65

Q: What is the future value in 10 years of 1500 payments received at the end of each year for tge next…

A: In the given question, 1,500 will be received (invested) at the end of each year for next 10 years.…

Q: Find a future value of an ordinary and annuity 300Paid quarterly for five years, if the interest…

A: If the interest is paid quarterly so the interest rate must be divided by 4 because in a year there…

Q: What is the present value of $250 annual payments received at the end of each of the next five…

A: Discounting is a technique to compute the present value (PV) of a future amount by using the…

Q: What is the present value of $2,000 paid at the end of each of the next 88 years if the…

A: Annual payment (P) = $ 2000 Number of annual payments (n)  = 88 Interest rate (r) = 8%

Q: A. What is the value of the annuity 5 years from now? B. What is the current value of the annuity?

A: Solution:- Given, A 5-year annuity of ten = $50,000 semi annul payments  Begin 9 years from now,…

Q: A series of equal quarterly payments of $5,000 for 10 years is equivalent to what future lump-sum…

A: The present value is the value of the sum received at time 0 or the current period. It is the value…

Q: What is the value today of receiving five annual payments of $500,000, beginning one year from now,…

A: Present value = Cash Flow 1/(1 + r)1 + Cash flow 2/(1 + r)2 + Cash Flow 3/(1 + r)3 + Cash flow 4/(1…

Q: Given an interest rate of 12% per year, what is the present value of a perpetual stream of $1,000…

A: Present value of Perpetuity = Periodic amount/ rate of interest

Q: What is the future value of $600 after eight years at an annual interest rate of 6 percent

A: Future Value = Present Value * (1+rate)^ time

Q: Given an interest rate of 6.5 percent per year, what is the value at date t = 8 of a perpetual…

A: Annual interest rate = 6.5% Annual payment = $ 900

Q: What sum must be deposited today at 18 percent per year compounded monthly if the goal 5 years from…

A: Time value of money is one widely used by the management to evaluate the project and to determine…

Q: What is the future value of $850 deposited for one year earning an 10 percent interest rate…

A: The future value is the instalment payment of fixed amount at a certain date in the future with a…

Q: If the interest rate is 9.3% compounded continuously, what is the required quarterly payment torepay…

A: Interest rate= 9.3% compounded continuously Loan amount (P0)= $15,000 Period = 8 years Required…

Q: What is the effective annual rate of interest if ​$900.00 grows to ​$1200.00 in four years…

A: Using excel RATE function

Q: A 10-year annuity of twenty $10,000 semiannual payments will begin 12 years from now, with the first…

A: Semiannual payment (A) = $10000 Annuity duration (n) = 10 years = 20 periods First payment (CF)…

Q: What is the present value of $10,000 to be received 10 years from now if the interest rateis 5…

A: Compound interest to interest charged on amount which is sum of principal and interest of previous…

Q: What is the future value of $400 deposited for one year earning an interest rate of 9 percent per…

A: The provided information are: Present value (PV) = 400 Rate of interest (i) = 9% Number of year (n)…

Present Value

Present value (PV) is defined as the current or present value of all future sums of cash flow or money at a specified rate of return. This rate of return is known as the discounted rate, which is essentially the interest rate, discounted over some time. The expected cash flows are discounted at a discount rate to compute the present value. The higher the discount rate, the higher the future value (FV), but the lower the present value.