If an investment of P750,000 that matures in 15 years but with certain specification that P 500000 will earn an interest of half of 1% paid semi- annually for 5 years and the remaining amount of investment will earn half of 1% of interest for the maturity term paid on a quarterly basis, What is the total FV of this investment option?

If an investment of P750,000 that matures in 15 years but with certain specification that P 500000 will earn an interest of half of 1% paid semi- annually for 5 years and the remaining amount of investment will earn half of 1% of interest for the maturity term paid on a quarterly basis, What is the total FV of this investment option?

EBK CONTEMPORARY FINANCIAL MANAGEMENT

14th Edition

ISBN:9781337514835

Author:MOYER

Publisher:MOYER

Chapter19: Lease And Intermediate-term Financing

Section: Chapter Questions

Problem 1P

See similar textbooks

Similar questions

Jullo Company is considering the purchase of a new bubble packaging machine. If the machine will provide $20,000 annual savings for 10 years and can be sold for $50,000 at the end of the period, what is the present value of the machine investment at a 9% interest rate with savings realized at year end?
Redbird Company is considering a project with an initial investment of $265,000 in new equipment that will yield annual net cash flows of $45,800 each year over its seven-year life. The companys minimum required rate of return is 8%. What is the internal rate of return? Should Redbird accept the project based on IRR?
A Treasury STRIP is purchased for $942 to mature at $1,000 in 3 years. Assuming annual compounding, what is its yield-to-maturity? Group of answer choices 2.0% 2.5% 3.0% 3.5% 4.0%
Sun Life Financial Trust offers a 360 -day short -term GIC at 0.65 %. It also offers a 120 -day short - term GIC at 0.58 % You are considering either the 360 -day GIC or three consecutive 120 -day For the 120 -day GICS , the entire maturity value would be "rolled over " into the next GIC. Assume that the posted rate increases by 0.1 % upon each renewal If you have $115,000 to invest , which option should you pursue and how much more interest will it earn?
Radu purchased a short-term $17.000, 60-day GIC which will earn 1% interest annually When the GIC matures, the maturity value is rolled into another short-term 180-day GIC which will earn 3.75% interest annually What is the maturity value of the second GIC?
An investment will pay $20,400 at the end of the first year, $30,400 at the end of the second year, and $50,400 at the end of the third year. (FV of $1, PV of $1, FVA of $1, and PVA of $1) Note: Use the appropriate factor(s) from the tables provided. Required: Determine the present value of this investment using a 9 percent annual interest rate.
(a)An investment is offered whereby £1000 is invested immediately, £2000 is invested in exactly threeyears’ time followed by a further investment of £3000 after a further threeyears. The investment is due to return £10000 in ten years’ from now. (i)Write down the equation of valuefor the investment (ii) Estimatethe yield on the investment. (b) (i)Calculate the present value, at a rate of interest of 6.5% per annum effective, of anannuity where £5000 is paidat the end of the first year, £4,800 is paid at the end ofthe second year, £4,600 is paid at the end of the third year and so on, with paymentsdecreasing by £200 per annum until the payment stream ends afterof 10 years. (ii)What would the payments be for an investment with the same present value, with equal payments every month?
What is the present value of a 15 year investment amounting to Ᵽ 45,670 if the prevailing interest is 2.5%? Based on Item No. 1 compute for the present value of Ᵽ 45,670 in 20, 22 and 25 years if the interest rates are 5.5%, 6.8% and 9.80% respectively.
A two year call option where underlying assets is $400 million. The exercise price is $600 million. Calculate the value of the option given that N(d1) =0.6 and N(d2)=0.4 and interest rate is 6%. a. $26.4 million b. $27.14 million c. None. d. $20 million.
consider the following investment option: option 1: invest $2000 for 8 years at 1o% compound annually option 2: invest $2000 for 8 years compounded continuously at 9 year how much will be investment be worth after 8 years
A. Assume that you have $7500 to invest. You plan to invest it for 10 years at a rate of 7% per year, compounded semiannually. What is the future value (FV) of this investment? B. Assume that you need to accumulate $25,000 by the end of 17 years. You can invest today at a rate of 12% per year, compounded quarterly. At that rate, how much must you invest today (PV) to accumu-late the $25,000? C. Assume that you have $5000 to invest today. At the end of 7 years, you need that $5000 to have grown to $10,000. If you invest at semiannual compounding, what annual rate must
How much willan investment of GH< 20.000 be worth in 10 years at an interest rate of 10%% per annum payable semi-annually? A) GH¢ 54,304.89 B) GH 67,980.98 C) GH¢ 53,065.95 D) GH¢ 69,603.44 E) GH¢ 65,056.59