Loose Leaf for Foundations of Financial Management Format: Loose-leaf
17th Edition
ISBN: 9781260464924
Author: BLOCK
Publisher: Mcgraw Hill Publishers
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Chapter 9, Problem 13P
Mrs. Crawford will receive
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Mrs. Crawford will receive $9,250 a year for the next 14 years from her trust. Use Appendix D for an approximate answer, but calculate your final answer using the formula and financial calculator methods.If a 8 percent interest rate is applied, what is the current value of the future payments? (Do not round intermediate calculations. Round your final answer to 2 decimal places.)
4. Mr. Thomas will receive $8,500 a year for the next 15 years from her trust. If a
7 percent interest rate is applied, what is the current value of the future payments if
first receipt occurs today?
Delia purchases an annuity that will pay her $10,000 per year for the next 10 years starting next year. Assuming a rate of 6%, what is the value of the annuity. Choose the closest.
a) $106,000
b) $131,808
c) $159,374
d) $171,569
Chapter 9 Solutions
Loose Leaf for Foundations of Financial Management Format: Loose-leaf
Ch. 9 - Prob. 1DQCh. 9 - How is the present value of a single sum related...Ch. 9 - Prob. 3DQCh. 9 - Does inflation have anything to do with making a...Ch. 9 - Adjust the annual formula for a future value of a...Ch. 9 - If, as an investor, you had a choice of daily,...Ch. 9 - What is a deferred annuity? (LO9-4)Ch. 9 - Prob. 8DQCh. 9 - Prob. 1PCh. 9 - Prob. 2P
Ch. 9 - a. What is the present value of $140,000 to be...Ch. 9 - If you invest $9,000 today, how much will you have...Ch. 9 - Prob. 6PCh. 9 - Your uncle offers you a choice of $105,000 in 10...Ch. 9 - Your father offers you a choice of $105,000 in 12...Ch. 9 - Prob. 9PCh. 9 - How much would you have to invest today to receive...Ch. 9 - If you invest $8,500 per period for the following...Ch. 9 - Prob. 12PCh. 9 - Mrs. Crawford will receive $7,600 a year for the...Ch. 9 - Phil Goode will receive $175,000 in 50 years. His...Ch. 9 - Sherwin Williams will receive $18,500 a year for...Ch. 9 - Carrie Tune will receive $19,500 for the next 20...Ch. 9 - The Clearinghouse Sweepstakes has just informed...Ch. 9 - Prob. 18PCh. 9 - Prob. 19PCh. 9 - Prob. 20PCh. 9 - At a growth (interest) rate of 10 percent...Ch. 9 - Prob. 22PCh. 9 - Prob. 23PCh. 9 - Prob. 24PCh. 9 - Juan Garza invested $20,000 10 years ago at 12...Ch. 9 - Prob. 26PCh. 9 - Prob. 27PCh. 9 - Prob. 28PCh. 9 - Prob. 29PCh. 9 - You need $28,974 at the end of 10 years, and your...Ch. 9 - Prob. 31PCh. 9 - Prob. 32PCh. 9 - Prob. 33PCh. 9 - Prob. 34PCh. 9 - Prob. 35PCh. 9 - Prob. 36PCh. 9 - Prob. 37PCh. 9 - Del Monty will receive the following payments at...Ch. 9 - Prob. 39PCh. 9 - Prob. 40PCh. 9 - Prob. 41PCh. 9 - Prob. 42PCh. 9 - Prob. 43PCh. 9 - Prob. 44PCh. 9 - Prob. 45PCh. 9 - Your younger sister, Linda, will start college in...
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- Your friend has a trust fund that will pay her the following amounts at the given interest rate for the given number of years. Calculate the current (present) value of your friends trust fund payments. For further instructions on future value in Excel, see Appendix C.arrow_forwardCarla Lopez deposits $5, 200 a year into her retirement account. If these funds have an average eaning of 6 percent over the 40 years until her retirement, what will be the value of her retirement account?arrow_forwardSarah will receive a perpetual annul income of $50,000 on her retirement, commencing in 3 years time. If the interest rate is 8% per annum, how much is this worth as a single sum today?arrow_forward
- Nilda expects to receive P20,940 at the beginning of each period per year in Social Security payments. Assume that she receives these payments for 28 years and use a rate of 6% per year. Find the present value of her retirement payments.arrow_forwardMary is going to receive a 31-year annuity of $8,600 per year. Nancy is going to receive a perpetuity of $8,600 per year. If the appropriate interest rate is 9 percent, how much more is Nancy’s cash flow worth?arrow_forwardJoe purchases a£50,30-year annuity. Larry purchases a£50perpetuity. In both cases, payments begin in one year, and the appropriate interest rate is12.5%. What is the present value of Larry's payments that will occur from year 31 onwards?arrow_forward
- Bill is the owner of an ordinary annuity that will pay him $12,000 at the end of each of the next three years. This annuity has an annual rate of return of 7%. Given this information, what is the present value today of this annuity?arrow_forwardSusan Co expects to receive P20,940 at the beginning of each period per year in Social Security payments. Assume that she receives these payments for 28 years and use a rate of 6% per year. Find the present value of her retirement payments.arrow_forwardAmy purchases an annuity that will give her payments of R at the end of each quarter for seven years. She will receive the first of these payments in 1.5 years. If Amy paid $50,000 for this annuity and will earn a nominal rate of interest of 6% compounded quarterly,(a) write the equation of value (using the appropriate actuarial notation) for this annuity at the time of purchase. Be sure to indicate the effective rate per payment period being used.(b) find the value of R.arrow_forward
- If the Alfa Life Insurance Co. will pay you and your heirs $1 at the beginning of each year forever, how much will you pay for the policy assuming the required return on this investment is 1 percent?arrow_forwardAbigail wishes to establish a trust fund from which her daughter can withdraw $6,000 every six months for 15 years, when she reaches 16 years old. At the end of which time, she will receive the remaining money in the trust, which she would like to be $25,000. The trust will be invested at 6% per annum compounded semi-annually. How large should the trust be?arrow_forwardBridget Jones has a contract in which she will receive the following payments for the next five years: $11,000, $12,000, $13,000, $14,000, and $15,000. She will then receive an annuity of $17,000 a year from the end of the 6th through the end of the 15th year. The appropriate discount rate is 11 percent. a. What is the present value of all future payments? Use Appendix B and Appendix D for an approximate answer, but calculate your final answer using the formula and financial calculator methods. (Do not round intermediate calculations. Round your final answer to 2 decimal places.)arrow_forward
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