What equal payments in 2 years and 5 years would replace payments of $35,000 and $87,500 in 7 years and 9 years, respectively? Assume money can earn 4.68% compounded semi-annually. Round to the nearest cent

Q: What amount must be set aside now to generate payments of $60,000 at the beginning of each year for…

A: The series of payments discussed here is a form of an annuity due wherein an equal payment is made…

Q: How much annual income would need to be generated over a 5 year period, to be equivalent to $4,000…

A: Calculate the annual income over a period of 5 years as follows:MS-Excel --> Formulas -->…

Q: A year-end bonus of $20,000 will generate how much money at the beginning of each month for the next…

A: Bonus amount (PV) = $20,000 Interest rate (r) = 6.21% Number of compounding per year (m) = 12 Number…

Q: Two payments of $9,000 and $5,300 are due in 1 year and 2 years, respectively. Calculate the two…

A: Payment due in Year 1 is $9,000 Payment due in year 2 is $5,300 Interest rate is 9% Compounded…

Q: a) What is the present worth ofequal payments of $25,000 made semi-annually (i.e., twice every year)…

A: Semi annual payment (P) = $25,000 Interest rate = 8% Semi annual interest rate (r) = 8%/2 = 4%

Q: What amount must be set aside now to generate payments of $20,000 at the beginning of each year for…

A: Working note:

Q: A payment of $15,000 is due in 1 year and $11,000 is due in 2 years. What two equal payments, one in…

A: Compounding is a technique which is used to compute the future value (FV) of the present amount by…

Q: What size monthly payments should occur when $10.000 is borrowed at 6% per year compounded monthly…

A: When the interest on interest is charged on monthly basis, it is known as monthly compounding. It…

Q: Two payments of $18,000 and $3,700 are due in 1 year and 2 years, respectively. Calculate the two…

A: Compound interest is a type of the interest which is charged on the loan. Compound interest is…

Q: Calculate the two equal payments that would replace these payments, made in 9 months and in 4 years…

A: Equivalent Amount of Payment is Calculated using time value of money. It is Calculated    As:—…

Q: What amount must be set aside now to generate payments of $40,000 at the beginning of each year for…

A: The formula to calculate present worth is given below: Here, i is interest rate. n is number of…

Q: What equal payments at the beginning of each year for 10 years will discharge a debt of 110,000…

A: Debt amount (PV) = 110,000 pesos Interest rate (r) = 8% Number of payments (n) = 10 Equal payment =…

Q: What series of equal payments is necessary to repay the following present amounts? $4,000 in five…

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

Q: If interest is compounded semi-annually (twice a year), and the interest rate is 3% per 6 month…

A: Present value is the current value of a specified amount you will received in a future date,…

Q: At what effective rate, a single payment of $ 1,500.00 today is equivalent to two payments of $…

A: An annuity is a series of equivalent periodic cash flows that contain a fixed amount occurring at…

Q: a series of 12 annual payments of $2400 is equivalent to three equal payments, one each at the end…

A: Present Value:  The present value is the value of cash flow stream or the fixed lump sum amount at…

Q: What should be the amount in an RRSP that is earning 5.50% compounded quarterly if it can be…

A: Present Value:  The present value is the value of cash flow stream or the fixed lump sum amount at…

Q: At what nominal rate, compounded monthly, would 12,000.00 have to be invested to amount to 21,811.13…

A: Interest is the amount charged on a loan or investment. It can be calculated by simple interest or…

Q: or total yearly payments of $10000 for 10 years, compare the compound amount accumulated at the end…

A: Given information: Annual payments : $10,000 Time periods : 10 years Nominal Rate of interest : 20%

Q: A service car whose cash price was ₱ 540,000 was bought with a down payment of ₱ 162,000 and monthly…

A: Annuity is a payment made in a fixed interval into a deposit or annual payment made for discharge of…

Q: Two payments of $14,000 and $3,400 are due in 1 year and 2 years, respectively. Calculate the two…

A: To replace the payments of different periods, we will first compute the NPV of payments to be…

Q: A payment of $17,000 is due in 1 year and $11,000 is due in 2 years. What two equal payments, one in…

A: Given : Annual interest rate is 3.25% So quarterly interest rate = 3.25/4 = 0.8125% We assume two…

Q: Two payments of $18,000 and $2,200 are due in 1 year and 2 years, respectively. Calculate the two…

A: Compounding refers to the power of increasing the interest on the total investment . It actually…

Q: Two payments of $12,000 and & 3,400 are due in 1 year and 2 years, respectively. Calculate the two…

A: Discounting is a technique to compute present value (PV) of future cashflows by considering…

Q: A payment of $23,000 is due today. What three equal payments, one in 2 years, one in 4 years, and…

A: The equivalent periodic cost is the periodic payment made towards the acquisition of an asset or…

Q: Payments of $657 and $1000 due 2 years ago and today respectively are to be replaced by two $1000…

A: The concept of TVM is used to compare the value of money at different times based on the interest…

Q: wo payments of $16,000 and $6,800 are due in 1 year and 2 years, respec alculate the two equal…

A: Present value of money would give the required money today that is equivalent to future payment to…

Q: If money is borrowed today with an amount of P50,000.00 and subjected to a 9% compounded quarterly…

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

Q: A payment of $12,000 is due in 1 year and $10,200 is due in 2 years. What two equal payments, one in…

A: Compounding is a process that uses an appropriate rate or CVF to calculate the future value (FV) of…

Q: A sum of $150,000 now at an interest rate of 10% per year compounded semiannually is equivalent to…

A: The present value of money is the discounted value of future cash flows used to determine the…

Q: What cash payment is equivalent to making payments of $1471.00 at the end of every year for 8 years…

A: Solution:- When an equal amount is paid at end of each period, it is called as ordinary annuity.…

Q: What is the equal-payment series for 10 years that is equivalent to a payment series starting with…

A: Given information: Initial amount is $10,000 Decreases by $1,000 over 10 years Interest rate is 7%

Q: What present value P amounts to $300,000 if it is invested at 5%, compounded semiannually, for 19…

A: PV  is Present value FV is Future value i.e. $300,000 r is Interest rate i.e. n is number of…

Q: If money is worth 8% compounded quarterly, find the present value of 12 quarterly payments of P1,…

A: The rate of interest is 8% compounded quarterly. The payment made for 12 quarters. the each payment…

Q: What cash payment is equivalent to making payments of ​$944.00 at the end of every six months for 9…

A: We need to use present value of annuity formula to calculate cash payment Cash payment(PV)…

Q: If money is woth 5 1/2% compounded annually, what single payment now equivalent to 45 annual…

A: Deferred annuity is a type of annuity in which the payment of annuity series began after a specified…

Q: A scheduled payment of $5,500 due in one year is to be replaced with two payments: the first due in…

A: Time value of money shows that the money available today is worth than the money in the future.

Q: A payment of $23,000 is due today. What three equal payments, one in 2 years, one in 4 years, and…

A: Given That: P.V=$23000 Payment is done in 3 equal payment Rate of interest= 4.25% Duration= 6 years…

Q: A payment of $1,750 is due in 2 years, and $5,800 is due in 5 years. What single payment made today…

A: To calculate the single payment of the payment due $ 1750 and $ 5800 in year 2 and year 5…

Q: How long (in years) will it take to repay a $100,000 loạn taken out today at 7% compounded monthly,…

A: The time value of money is the one widely used by companies and individuals to determine the current…

Q: How long will it take the money to double itself if invested at 16% compounded quarterly? In how…

A: Convert 16% compounded quarterly to its equivalent interest rate for annual interval. Here, 'r'…

Q: A payment of $12,000 is due in 1 year and $11,500 is due in 2 years. What two equal payments, one in…

A: The present value method uses the discount rate to find the present values of the cash flows.

Q: For total yearly payments of $10000 for 10 years, compare the compound amount accumulated at the end…

A: An ordinary annuity is a series of equal payments made over a period of time.  It has been…

Q: A demand loan of $8000.00 is repaid by payments of $4000.00 after two years, $4000.00 after four…

A: Information Provided: Demand loan = $8000 Payments after two years = $4000 Payments after four years…

Q: If money earns 3.9% compounded monthly, what two equal payments, one in 1 year and the other in 2…

A: Here, Interest Rate is 3.9% Compounding Period is Monthly i.e. 12 One Payment is made in Year1…

Q: A 20% compounded quarterly has an equivalent rate of 10.25%, how many times does it pay every year?…

A: Effective Annual Rate = 1+Nominal RateNumber of PeriodsNumber of Periods-1

Q: payment of $16,000 is due in 1 year and $11,700 is due in 2 years. What two equal ayments, one in 3…

A: Effective interest rate is that is rate after considering the impact of compounding and more then…

Q: Payments of $1300 due today and $1800 due in 1_34 years are to be replaced by a single payment four…

A: given, rate = 2% m=4 let cashflow at year 4 = A year cashflow 0 1300 1 1800 3 1800 4 1800…

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.