Draw a cash flow diagram too c) You are an engineer working for the city of Seoul. You have estimated the annual toll revenues from anewly proposed highway construction over 25 years as follows:An= ($2,500,000)(n)(1.08)n-1n=1,2,..., 25To validate the bond, you were asked to provide the estimated total present value of the toll revenue at aninterest rate of 8%. Assuming annual compounding, calculate the present value of the estimated toll.

The PV analysis is undertaken to measure the profitability of a project by discounting the future…

Answered: c) You are an engineer working for the…

EBK CONTEMPORARY FINANCIAL MANAGEMENT

14th Edition

ISBN:9781337514835

Author:MOYER

Publisher:MOYER

Chapter16: Working Capital Policy And Short-term Financing

Section: Chapter Questions

Problem 34P

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A company is considering to start a new product line which requires the installation of new machines and equipment. For this purpose, company wants to borrow money by issuing bonds of Php 10,000 for 12-year period. The interest on these bonds is to be paid at a rate of 8% per year. Compute the amount of interest to be paid to bondholders over 12-year period: if the simple interest is charged.if the compounded interest is charged and the interest is compounded:(1), annually,(ii), semi-annually.(ii). quarterly (iv). Monthly Kindly answer asap please
A company is considering starting a new product line. The new product line requires the installation ofnew machines and equipment. For this purpose, company wants to borrow money by issuing bonds of$10,000 for 12-year period. The interest on these bonds is to be paid at a rate of 10% per year. Computethe amount of interest to be paid to bondholders over 12-year period:a) if the simple interest is charged. b) If the interest is compounded annually.
A city has issued bonds to finance a new convention center. The bonds have a total face value of $3,000,000 and are payable in 8 years. A sinking fund has been opened to meet this obligation. If the interest rate on the fund is 6.7% compounded quarterly, what will be the quarterly payments? (Round your final answer to two decimal places.)
A municipality needs funding for upcoming infrastructure (water and sewer line) repair or replacement. They issue a series of $1,000, 7% semiannual, 11-year bonds . The bonds are initially sold at a discount for $980. If you buy a bond for $980, plan to sell it immediately following the 16th interest payment, and want to earn 9% compounded semiannually on your money, what must be the selling price? Carry all interim calculations to 5 decimal places and then round your final answer to 2 decimal places.
The government borrowed a certain amount of money to build a new bridge. It pays interest at a rate of 12%. If the yearly repayments are $320,000, calculate the amount borrowed.
A person to start a project 8 years ago placed a deposit of ¢ 1,500,000.00 in a financial institution that recognized him during the first 3 years a 5% capitalizable monthly, 2 following years an 8% capitalizable quarterly, and the rest of the term a 7% capitalizable bimonthly, it is requested to make and determine:a) How much do I accumulate in the total term of the investment? b) Do you calculate the effective annual rate that produced the investment?
Sanders Co. is planning to finance an expansion of its operations by borrowing $52,100. City Bank has agreed to loan Sanders the funds. Sanders has two repayment options: (1) to issue a note with the principal due in 10 years and with interest payable annually or (2) to issue a note to repay $5,210 of the principal each year along with the annual interest based on the unpaid principal balance. Assume the interest rate is 8.5 percent for each option. What amount of interest will Sanders pay in year 1 under option 1 and under option 2? What amount of interest will Sanders pay in year 2 under option 1 and under option 2?
You pay $5600 for a municipal bond. When it matures after 15 years, you receive $11,000 The total return is ___%.
ABC borrows $12,827 at a subsidized rate of 2.5% to invest in a project. The project lasts for 14 years and ABC repays the loan at the end of the project. If ABC's cost of debt is 6.1% and the tax rate is 36%, calculate the NPV of the this loan financing. plz keep 4 decimal.
Dexter Construction Corporation is building a student condominium complex; it started construction on January 1, Year 1. Dexter borrowed 2.5 million on January 1 specifically for the project by issuing a 10%, 5-vear, 2.5 million note, which is payable on December 31 of Year 3. Dexter also had a 12%, 5-year, 3 million note payable and a 10%, 10-year, 1.8 million note payable outstanding all year. Calculate the weighted average interest rate on the non-construction-specific debt for Year 1. RE10-9 Refer to RE10-8. In Year 1, Dexter incurred costs as follows: Calculate Dexters weighted average accumulated expenditures.
Using the information provided, what transaction represents the best application of the present value of an annuity due of $1? A. Falcon Products leases an office building for 8 years with annual lease payments of $100,000 to be made at the beginning of each year. B. Compass, Inc., signs a note of $32,000, which requires the company to pay back the principal plus interest in four years. C. Bahwat Company plans to deposit a lump sum of $100.000 for the construction of a solar farm In 4 years. D. NYC Industries leases a car for 4 yearly annual lease payments of $12,000, where payments are made at the end of each year.
Electro Corporation bought a new machine and agreed to pay for it in equal annual installments of 5,000 at the end of each of the next 5 years. Assume a prevailing interest rate of 15%. The present value of an ordinary annuity of 1 at 15% for 5 periods is 3.35. The future amount of an ordinary annuity of 1 at 15% for 5 periods is 6.74. The present value of 1 at 15% for 5 periods is 0.5. How much should Electro record as the cost of the machine? a. 12,500 b. 16,750 c. 25,000 d. 33,700

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