None You are promised $450 one year from now.Assuming prevailing interest rates are at 4%, whatis that promise worth today?a. $430.00b. $432.69C. $96.15d. $450.00

Formula: PV = FV ÷ (1 + r)nGiven:Present value (PV) = ?Future value (FV) = $450Interest rate (r) =…

Answered: You are promised $450 one year from…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Assume you invest $15,000 today. How much will you have in six years at an interest rate of 9%? Future Value of $1: 8% 123456 1.080 1.166 1.260 1.360 1.469 1.587 OA. $23.805 OB. $25,155 OC. $26.580 OD. $23,085 9% 1.090 1.188 1.295 1.412 1.539 1.677 10% 1.100 1.210 1.331 1.464 1.611 1.772 MAKED ہے
2. Assume that you can invest to earn a stated annual rate of return of 12 percent, but where interest is compounded semiannually. If you make 20 consecutive semiannual deposits of $500 each, with the first deposit being made today, what will your balance be at the end of Year 20? $57,900.83 $58,988.19 O $52,821.19 O $64,131.50 O $62,527.47
Your.
You will receive $100 from a savings bond in 2 years. The nominal interest rate is 8.40%. a. If the inflation rate over the next few years is expected to be 3.40%, what will the real value of the $100 payoff be in terms of today’s dollars? (Do not round intermediate calculations. Round your answer to 2 decimal places.) b. What is the real interest rate? (Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places.) c. Calculate the real payoff from the bond [from part (a)] discounted at the real interest rate [from part (b)]. (Do not round intermediate calculations. Round your answer to 2 decimal places.)
Use the following 10% present value factors: N 1: 0.9091 N = 2: 0.8264 N= 3: 0.7513 Assume you wish to receive $1,000 at the end of two years. Assuming an interest rate of 10% what amount would you need to deposit todayin order to receive the S1, 000? Round to the nearest penny if necessary.
1. Suppose the term structure of interest rates is shown below: 1 year Term Rate (EAR%) 5.00% 2 years 4.80% 3 years 4.60% 5 years 4.50% 10 years 4.25% 20 years 4.15% What is the present value (PV) of receiving $1100 per year with certainty at the end of the next three years?
What would you prefer to receive if the interest rate is 20%? OA. $64 one year from now B. $95 four years from now OC. $84 three years from now O D. $73 two years from now.
What is the present value of a perpetuity (no maturity date) with a constant coupon payment of $100 annually with interest rate of 10%? O a. $1100 O b. $100 O c. $909.1 O d. $90.9 e. $1,000
Your liabilities consist of $60,000 coming due in one year and $40,000 coming due in three years. The market interest rate is 7%. What is the convexity of your liabilities? O4.144 O 4,244 3.944 O4.344
Assuming you bought a 182-day Treasury Bill with a face value Ghc 20,000.00 and held it for 45days. If you want to sell it and interest rate is currently at 25%, at what price will you sell it?
Assume you make a deposit of $7,500 now into a saving account that pays 12% per year, compounded quarterly. If you want to know the total amount after 2 years, the value of interest rate (i) you should use in the F/P factor is: Select one: а. 3% b. 4 % с. 24% d. 12 %
If the interest rate is 15%, what is the present valueLOADING... of a security that pays you $1100 next year, $1230 the year after, and $1330 the year after that? Present value is $ enter your response here. ( Round your response to the nearest penny.)

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You are promised $450 one year from now. Assuming prevailing interest rates are at 4%, what is that promise worth today? a. $430.00 b. $432.69 C. $96.15 d. $450.00