The annual discount rate is 7.70%. a. What is the present value of a perpetuity that pays 2,000 at the end of every other year, starting at year 2 (that is, payments happen at year 2, 4, 6, ...)?
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- What is the present value of an annuity that pays $536 at the end of each year in years 4 through 12? The discount rate (opportunity cost) is 3.5%.what;s the present value of perpetuity that pays % 1, 563 per year if the appropriate interest rate is 6.8% ?What is the difference in present value between a perpetuity that pays $500 per year and an ordinary annuity that pays $500 per year for 23 years? Assume a discount rate of 7% and cash flows at the end of the period. Enter your answer as a number rounded to 2 decimal places.
- 7. What is the present value of a perpetuity of annual payments where the first payment is in one year and each payment is $4599.99? assume that time zero is now and the effective interest rate per year is 14%.What is the present value of a perpetuity with payments starting one year from now. The first payment is $25,000. Assume a discount rate of 8%.An annuity pays $13 per year for 42 years. What is the future value (FV) of this annuity at the end of that 42 years given that the discount rate is 4%? OA. $817.59 B. $1,635.18 OC. $1,362.65 D. $1,907.71 ...
- What is the present value of a perpetuity consisting of equal payments of $66 every 3 months, where the first payment occurs 3 months from now, and the interest rate is 12% p.a.?Present Value of an Annuity. Find the present values of these ordinary annuities. Discounting occurs once a year. A) $600 per year for 12 years at 8% B) $300 per year for 6 years at 4% C) $500 per year for 6 years at 0% D) rework parts a,b, and c assuming they are annuities due. please show steps. Thank you.Consider two perpetuities (X and Y) at interest rate i. X provides level payments of $105 at the end of each year. Y provides a payment of $5 at the end of the first year, with payments increasing by $5 annually. Find i such that the present value of (X-Y) is a maximum. (Answer to the nearest .05%.)
- An annuity pays 2 at the end of each year for 18 years. for 9 Another annuity pays 2.5 at the end of each At an effective annual interest rate of i, 0 < i < 1, the present values of both annuities are equal. Calculate i. year years.What is the present value of a perpetuity that pays annual, end-of-year payments of $850 every year? Use a nominal rate of 8.00%. O $10,625 O $10,952 O $10,241 O $9,133 O $9,004A perpetuity pays $250 per year and interest rates are 7.0 percent. How much would its value change if interest rates increased to 8.5 percent? (Round your answer to 2 decimal places.) Change in value Did the value increase or decrease? decrease O increase