You are considering investing in a security that will pay you $1000 in 30 years. If the appropriate discount rate is 10%, what is the present value of this investment? Assume these investments sell for $365, in return for which you receive $1000 in 30 years, what is the rate of return investors earn on this investment if they buy it for $365? b What is the accumulated sum of each of the following streams of ordinary annuity payments? $35 per half-year for three and a half years at 14% p.a. compounded half- yearly. $25 a year for three years compounded annually at 2%. $500 a year for 10 years compounded annually at 5%

You are contemplating the purchase of a twenty-four year (variable) annuity that promises cash flows in the following pattern, repeating every four years:e 6. 3 21e 22e 23 24 $1,600- $1,500- $1,400- $1,300 $1,600- $1,500 $1,400 $1,300- Suppose you don't like the fluctuations in the amount of your annual benefits. a. What annual rate of return would you use to convert these (end-of-year) cash flows to equal annual (end-of-year) amounts if you required an APR of 14.4%, compounded monthly? b. Without prejudice to your answer in part a, suppose that your required annual rate of return is 15%, what equal annual (beginning-of-year) payments over the twenty-four year period would be equivalent to the cash flow stream depicted above?

You are managing an investment portfolio and sell an “inflation-protected” annuity that pays $3,862 per month (in real terms) for 7 years, starting next month. You forecast that inflation will be 0.45% per month over the 7 years. If you earn 4.17% APR (monthly compounding) nominal terms on your investments, how much do you need to invest today to fully fund the annuity?

You are managing an investment portfolio and sell an “inflation protected” annuity that pays $3,448 per month (in real terms) for 9 years, starting next month. You forecast that inflation will be 0.33% per month over the 9 years. If you earn 3.54% APR (monthly compounding) nominal terms on your investments, how much do you need to invest today to fully fund the annuity?

You are considering investing in a security that will pay you $2,000 in 35 years.   a.  If the appropriate discount rate is 10 percent​, what is the present value of this​ investment? b.  Assume these investments sell for ​$275 in return for which you receive ​$2,000 in 35 years. What is the rate of return investors earn on this investment if they buy it for ​$275​?

. Evaluate the following statement:Consider two riskless perpetuities: (i) pays $120 every year; (ii) pays $10 every month. If the rates of returns of the two perpetuities are the same, investors must buy perpetuity (ii) because it makes more interest payments.

please step by step solution.

If you require a 12% annual return on your investments, would you prefer S20, 000 six years from today or an annuity paying Sl, 800 at the beginning of each year for 13 years. a. The annuity paying Sl, 800 at the beginning of each year for 13 years.b.The annuity paying Sl, 600 at the beginning of each year for 15 years.c.The S20, 000 six years from today d.The S20, 000 five years from today

You are offered an investment that requires you to put up $5,000 today in exchange for $12,000 10 years from now. What is the annual rate of return on this investment?

You are looking at two investment options, A and B. Investment A is a 15-year annuity that needs an end-of-month payment of $1,100 and has an APR of 9% compounded monthly. Investment B is also a 15-year investment, but a lump sum investment that has as an APR of 8% compounded daily. How much money do you need to invest in B today as a single lump sum amount if you wish to have the same wealth as in Investment A in 15 years? If Investment B, with 8% APR compounded daily, gave you the option of investing a constant amount at the end of every six months, what would this amount be in order to give you the same wealth as in A at the end of 15 years?