Growing perpetuity: You are evaluating a growing perpetuity investment from a large financial services firm. The investment promises an initial payment of $20,000 at the end of this year and subsequent payments that will grow at a rate of 3.4 percent annually. If you use a 9 percent discount rate for investments like this, what is the present value of this growing perpetuity? Please use Excel to solve

Q: A. An ordinary annuity selling at $2,514.15 today promises to make equal payments at the end of each…

A: In ordinary annuity, payment occurs at the end of the every period. Value of annuity is the present…

Q: You can expect annual benefit of $15,800 if you deposit $142,200 in a bank account right now. The…

A: Pay back period is the period required to recover the initial cost of the project.

Q: You are considering investing $1,000 in an investment fund at the end of every quarter for the next…

A: As per the time value of money concept, a certain amount held today is worth more than holding the…

Q: A loan of $50,000 is due 10 years from today. The borrower wants to make monthly payments at the end…

A: The payments made constantly without any uneven time gap are called annuity where nominal amount for…

Q: Using Table 1-1 onpage 19, calculate the following:(a) The future value of lump-sum investment of…

A: Calculation of Future Value and Present Value:Excel Spreadsheet:

Q: A new investment opportunity for you is an annuity that pays $800 at the beginning of each year for…

A: Beginning of period Annuity Annuity Amount = 800 Time Period (N) = 3 years Rate = 5.5%

Q: An investment pays you $100 at the end of each of the next 3 years. The investment will then pay you…

A: Here,

Q: Use the following table for this questio Present value of an Annuity of $1   Periods…

A: Net present value(NPV) is the difference between present value of all cash inflows and initial…

Q: A small business owner deposits $5000 monthly deposits in an equity fund as his financial analysis…

A: future value of annuity formula: Future value =A×1+rmm×n-1rmwhere,A=annuityr=rate of…

Q: An investment pays $2,100 per year for the first 4 years, $4,200 per year for the next 3 years, and…

A: The real interest that an investor earns on the investment and a borrower pays on loan after…

Q: A perpetuity will make its first payment in 20 years. The first payment will be $5,000, and future…

A: Perpetuity means a series of infinite numbers of payments of the same size occurs in an equal…

Q: You are considering investing in a security that will pay you $1000 in 30 years. If the appropriate…

A: Excel Spreadsheet:

Q: Your grandmother just gave you $6,000. You'd like to see how much it might grow if you invest it. a.…

A: PLEASE REFER TO STEP-2 FOR SOLUTION,

Q: What single investment made today, earning 10 % annual interest, will be worth $10,000 at the end of…

A: A) The present value of a future value can be calculated using the formula below: Given; FV = 10000…

Q: How much would a business have to invest in a high-growth fund to receive $22,000 every month for 5…

A: Solution:- When an equal amount is receivable each period, it is called annuity. So, present value…

Q: How much would you be willing to pay for this investment if you required a 12 percent rate of…

A: Present Value of Annuity: It represents the present worth of the future annuity stream of cash…

Q: Solve the following problem. Use Excel, financial calculator, or PV and FV Tables. Show your work…

A: given information   amount = AED 10000 every year  time period = 4years = 16 quarters interest rate…

Q: If Quail Company invests $46,000 today, it can expect to receive $12,000 at the end of each year for…

A: Net present value method is used to evaluate the investment projects. We can evaluate the project by…

Q: eposit $10,000 into an investment account.  You believe that you can reasonably expect a compounding…

A: The more is compounding of interest rate more is the effective interest rate and more is future…

Q: Consider an investment that offers $4,000, $5,000 and $6,000 in the next 3 years, with the first…

A: Present value is the concept of time value of money. Time value of money concept states that value…

Q: Mitchell Investments has offered you the following investment opportunity: $7,000 at the end of…

A: Here, $7,000 at the end of each year for the first 7 years, plus $5,000 at the end of each year from…

Q: If 14700 dollars is invested at an interest rate of 9 percent per year, compounded semiannually,…

A: The amount at the end of a specific number of years will be the future value of the initial deposit.

Q: How much would you be willing to pay for this investment if you required a 8 percent rate of return?…

A: Value of an investment is the discounted value of cash flows, at the rate of required rate of…

Q: Eric is evaluating a growing perpetuity investment from a large financial service firm. The…

A: The present value (PV) of a growing perpetuity  PV = PMT1 / (r - g) R = rate, G = growth and PMT1 =…

Q: Future Value of Annuity. YOU plan to retire 30 years from now. To provide for that retirement, you…

A:

Q: How much would a business have to invest in a high-growth fund to receive $14,000 every month for 6…

A: Investments are the ways by which individuals and corporations park or save their money and funds in…

Q: :Sidir steinəl What is the present value of your end-of-year investment of $1,000 per year, with the…

A: The present value of the annuity is the current worth of a cash flow series at a certain rate of…

Q: A company wants to have $30,000 at the beginning of each 6-month period for the next 4 1/2 years. If…

A: Semi annual payment = $30,000 Period = 4 1/2 = 4.50 Years Semi annual period = 4.50*2 = 9 Interest…

Q: Find the required value for each problem. Show the formula used and the counts for each problem. 1.…

A: Because you have psoted multiple questions, we will answer the first question only, for the…

Q: Computing the Present Value of a Single Amount Depp is reviewing an investment that will provide a…

A: Definition: Present value: This is the amount of future value reduced or discounted at a rate of…

Q: Present value of an ordinary annuity: Dynamics Telecommunications Corp. has made an investment in…

A: Present value annuity can be calculated using an excel, where the regular payment (PMT) of $22500 is…

Q: You are evaluating a growing perpetuity investment from a large financial services firm. The…

A: Present value shows the value of the investment in the present time.

Q: An investment will pay $100 at the end of each of the next 3 years, $200 at the end of Year 4, $300…

A: Formulas:

Q: You have the opportunity to invest in several annuities. Which of the following 10-year annuities…

A: Annuities are payment received at fixed intervals for fixed periods of time.

Q: present

A: Formula to calculate present value of growing perpetuity  Payment for the first year/Discount rate -…

Q: a) What single investment made today, earning 12% annual interest, will be worth $6,000 at the end…

A: The question is related to Time value of money. The present value is calculated with the help of…

Q: Consider an investment which pays $3,000 at the end of year 1, year 2, and year 3. In year 4, the…

A: Present value refers to the current valuation for a future sum. Investors determine the present…

Q: ou have been offered an investment that will pay you a lump sum of $30,000 25 years from today,…

A: Answer : Lump sum = $30,000 Interest rate = 6% Time = 25 years PV 6%, 25year = 1/1.06^25 = 0.233 PVA…

Q: 3. Your investment will pay $500 at the beginning of each of first 2 years, $100 at the end of…

A: Present value can be calculated by using this equation PV =FV/(1+r)n and  FV =PV(1+r)n where PV…

Q: You have your choice of two investment accounts. Investment A is a 6-year annuity that features…

A: Solution:- Given, Invest A is a 6-year annuity that features end-of-month = $3,000 Investment A -…

Q: A similar application for investment yields can be made in cases where monthly cash annuities will…

A: PRESENT VALUE 51593 NPER (n)  240 PMT 400 FUTURE VALUE 0

Q: How much money would you need to invest in B today for it to be worth as much as Investment A 14…

A: Time value of money concept states that the value of investment in current period has higher worth…

Q: Use Excel to calculate the solutions to the following problems. Your worksheet will be graded on…

A: The question is based on calculation of present value and future value of different form of…

Types of Insurance Contract

Insurance is a contract wherein an individual or entity gets financial protection from the insurance company for any damages or losses incurred. The individual or entity is called the insured, whereas the insurance company is called the insurer. The insured and the insurer enter a legal contract for a fixed term called the insurance term, and the contract is called an insurance policy.