You have entered into an agreement for the purchase of land. The agreement specifies that you will take ownership of the land immediately. You have agreed to pay $35,000 today and another $35,000 in three years. Calculate the total cost of the land today, assuming a discount rate of (a) 3%, (b) 5%, or (c) 7%. (FV of $1. PV of $1. EVA of $1, and PVA of $1) (Use tables, Excel, or a financial calculator. Round your answers to 2 decimal places.) a. b. C. Payment Interest Amount Rate $ 35,000 35,000 35,000 Compounding 3% Annually 5% Annually 7% Annually Period Due 3 years 3 years 3 years Total Cost of Land Today
You have entered into an agreement for the purchase of land. The agreement specifies that you will take ownership of the land immediately. You have agreed to pay $35,000 today and another $35,000 in three years. Calculate the total cost of the land today, assuming a discount rate of (a) 3%, (b) 5%, or (c) 7%. (FV of $1. PV of $1. EVA of $1, and PVA of $1) (Use tables, Excel, or a financial calculator. Round your answers to 2 decimal places.) a. b. C. Payment Interest Amount Rate $ 35,000 35,000 35,000 Compounding 3% Annually 5% Annually 7% Annually Period Due 3 years 3 years 3 years Total Cost of Land Today
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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