Security Cash flow Cash flow Today ($) in one year ($) A 50 B 200 200 100 If the current value (price) of security "C" is $280, then what must be the no-arbitrage price of security "A" today?
Q: What is the present value of the following cash flow at a 12% discount rate?…
A: Present value is calculated using the discounting factor of Rate @ 12%
Q: 24) What is the present value of the following set of cash flows, discounted at 10.3% per year? Year…
A: The purchasing value of money reduces over time. This reduction in the purchasing power of money is…
Q: Year Cash Flow 0 –$ 17,700 1 10,000 2 8,900 3 5,400 a. What is the…
A: The formula to compute profitability index:
Q: en the following two sets of cash flows: ion A: $48,858.00 in 3 years plus $Y in 13 years time. ion…
A: In this we have to make both options equal and than we can get the Y.
Q: Question 6 Calculate the rate of return per year (IRR) for the following cash flow:(XO=s-56,000,…
A: Internal rate of return is the discount rate where the present value of inflows equals present value…
Q: Problem 1. What is the future value of the following cash flows AT THE END OF YEAR 5, assuming a 6%…
A: We’ll answer the first question since the exact one wasn’t specified. Please submit a new question…
Q: (a) Using tabulated factors for the cash flow series shown, calculate the future worth at the end of…
A: Future value refers to the future worth of current cash flow at a certain rate of interest and…
Q: 25) What is the present value of the following set of cash flows, discounted at 15% per year? Year 1…
A: The concept of the time value of money states that the current worth of money is more than its value…
Q: EXERCISE 2: FUTURE VALUES AND PRESENT VALUES With an 8% interest rate, calculate the (1) net future…
A: Given information: Cash flows for five years at the rate of an 8% interest are as follows: 0 $…
Q: What is the net present value of the following set of cash flows at a discount rate of 5 percent? at…
A: Net Present Value(NPV) is excess of PV of inflows over PV of outflows that is computed by…
Q: ( Present value of complex cash flows ) How much do you have to deposit today so that beginning 11…
A: Time value of money is the most used concept in finance that states that the money received today is…
Q: $27,300.00
A:
Q: The net present value (NPV) the cash flows from T=0 to T=3 is $2278 when using a 10% discount rate.…
A: Net present value = Total Present value of all years cash flows - initial investment, applying the…
Q: Year Cash Flow $275.000 1 $35,000 2 $65.000 36 $95.000 $135.000 $185.000 9-20 $245,000 Given the…
A: The Payback period is one of the capital budgeting techniques that do not take into account the…
Q: PMT Question 4: What is the annual worth of the given cash flow applied to 8 years? Assume the…
A: Interest Rate(Rate) 13.50% Time Period (Years)(NPER) 8 Year Cash Flow 1 24,000.00 2…
Q: 10. Consider the following cash flow series at varying interest rates. Interest rates: Between 0 to…
A: Interest rate in year n = rn r1 = 5% r2 = 8% r3 = 10% r4 = 6% Cashflow in year n = CFn CF1 = $1000…
Q: Quantitative Problem: You own a security with the cash flows shown below. 1 3 610 390 270 300 If you…
A: Year -1 Cash flow is 610 Year -2 Cash flow is 390 Year -3 Cash flow is 270 Year -4 Cash flow is 300…
Q: A firm is considering an investment which will provide an annual cash inflow of $10,000 for the next…
A: The Present Value is the current value of a future amount i.e., it is the amount to be invested…
Q: 17. Suppose we have a series of cash flows like this: x dollar at the end of 3 months, 100 dollar at…
A: Since you have asked multiple question, we will solve the first question for you. If you want any…
Q: Problem 1 The cash flow shown in Figure 1 is in $1000 units. With an interest rate of 10%, determine…
A: Interest rate = 10% Year Cash flow 1 500000 2 600000 3 700000 4 800000 5 900000 6…
Q: Q1! Solve for the present worth of this cash flow using at 12% interest rate annually. t60 130 160…
A: Interest Rate = 12% annually In order to calculate present Worth we have to calculate the present…
Q: • 4. Compute the present value and future value of P200 cash flow for the following combination of…
A: Present Value Meaning Given a certain rate of return, present value (PV) is the current value of a…
Q: Quantitative Problem: You own a security with the cash flows shown below. 2 3 620 365 240 290 If you…
A: Present value = Cash flows*Discounting factor Discounting factor…
Q: 1) What is the present worth of this cash flow diagram given i = 8.66% ? 2) What is the future worth…
A: The present value is the value of the sum received at time 0 or the current period. It is the value…
Q: What is the present value (as at year 0) of the following cash flows, given an interest rate of 8%…
A: Present value is the current worth of future cashflows discounted at a given rate.
Q: Determine the present equivalent value of the cash-flow diagram of the shown figure, when the annual…
A: Year Cash Flow Interest % for discounting in year 1 1000 8% 2 2000 10% 3 0 8% 4 1000 6% 5…
Q: What is the present worth of the following cash flows with interest rate 7% per year (Limitation:…
A: Present value/worth of annuity is the current value of the future payments that are calculated using…
Q: what is the future value of this cash flow at 3%, 11%, and 18% interest rates at the end of…
A: Future value refers to the future value of a current asset based on a certain rate of interest. It…
Q: In the following cash flows diagram, Determine the Future Worth at the end of year 12 f the interest…
A: Future value = cashflow *(1+rate)^years
Q: (A_FIG1) In the following cash flows diagram, Determine the value of Z if the interest rate i = 8%…
A: Hi There, Thanks for posting the questions. As per our Q&A guidelines, must be answered only one…
Q: You own a security with the cash flows shown below. 0 1 2 3 4 0 690 395 230…
A: Present value of cash flow will be calculated by cash flow multiply with present value factor.
Q: Year Cash Flow 17600 9,900 8,800 5,300 a. What is the profitabllity index for the set of cash flows…
A: Profitability index: It is the ratio of present value of cash inflows to present value of cash…
Q: Ata certain discount rate the present values of the following cash flows are equal a) 808 at the end…
A: The Net Present value can be calculated as follows:
Q: What is the future value (as at year 4) of the following cash flows, given an interest rate of 5%…
A: Future value = Present value*(1+rate)^years
Q: The following cash flows are in actual dollars: Cash Flow (in Actual $) $25,000 4 35,000 45,000 7…
A: A constant dollar is the adjusted value which is used to compare the value of one period with that…
Q: What is the present value of the following set of cash flows at a 10% discount rate? Year Cash Flow…
A: The computation as follows: Hence, the present value of cash flows is OMR 120.76. Hence, the option…
Q: What is the future value of the following set of cash flows 4 years from now? Assume interest rate…
A: Horizon is n = 4 years from now.FVn = The future value at the end of period n, of a cash flow…
Q: Q7. Construct a cash flow diagram for the following cash flows: $20,000 outflow at time zero, $4000…
A: Cashflow means movement of cash. It can be negative and positive. Negative movement means outflow of…
Q: 4.Find the present worth in year 0 (PT) for the cash flow diagram using an interest rate of 10% per…
A: Present Value(PV) is current value of any future payment computed by discounting that future amount…
Q: QUESTION 6 For the given cash flow, if A= $8000 , the present value P is closest to: $6000 A 8.…
A: A = 8000 N = Number of cash flows = 6 T = Time period for discounting A = 2 Immediate cash flows…
Q: Problem 2. What is the present value of the following cash flows, if the discount rate is 10%…
A: Present value: It can be defined as today’s worth of an investment that will be received in the…
Q: follows: period 1, -$100; period 2, $200. Assume a time value of money of 0.05. Should the company…
A: Time value of money means decline in value of money with the passage of time due to inflation, etc.…
Q: (A_FIG1) In the following cash flows diagram, Determine the value of Z if the interest rate i = 8%…
A: The interest rate is 8%. We have to calculate the present value.
Trending now
This is a popular solution!
Step by step
Solved in 3 steps with 2 images
- (Related to Checkpoint 7.1) (Expectedrate of return and risk) B. J. Gautney Enterprises is evaluating a security. One-year Treasury bills are currently paying 5.2 percent. Calculate the investment's expected return and its standard deviation. Should Gautney invest in this security? Probability Return0.10 -6%0.35 3%0.45 7%0.10 8% The investment's standard deviation is______% RUND TO THE 2 decimal place)(Expected rate of return and risk) B. J. Gautney Enterprises is evaluating a security. One-year Treasury bills are currently paying 3.9 percent. Calculate the investment's expected return and its standard deviation. Should Gautney invest in this security? Probability Return 0.20 −5 % 0.50 4 % 0.10 5 % 0.20 8 % (Click on the icon in order to copy its contents into a spreadsheet.) Question content area bottom Part 1 a. The investment's expected return is enter your response here%. (Round to two decimal places.) b. the investment's standard devation is? round 2 decimal places c. should gautney invest in this security?(Expected rate of return and risk) B. J. Gautney Enterprises is evaluating a security. One-year Treasury bills are currently paying 4.8 percent. Calculate the investment's expected return and its standard deviation. Should Gautney invest in this security? Probability Return 0.10 −6 % 0.35 4 % 0.45 5 % 0.10 10 % (Click on the icon in order to copy its contents into a spreadsheet.) Question content area bottom Part 1 a. The investment's expected return is enter your response here%. (Round to two decimal places.)
- We have purchased a security with the following payment schedule: Year 1 2 3 Payment $100 S150 S400 If the present value of this investment is $580.59, what is the rate of return (or interest rate) ?Expected rate of return and risk) B. J. Gautney Enterprises is evaluating a security. One-year Treasury bills are currently paying 2.0 percent. Calculate the investment's expected return and its standard deviation. Should Gautney invest in this security? Probability Return 0.20 −7 % 0.30 1 % 0.30 3 % 0.20 7 %Only typed answer Suppose that the current 4-year treasury security rate is 5.5 percent and the 1-year treasury rate is 3.75 percent. According to the unbiased expectations theory, what should be the 3-year expected rate 1-year from now? Group of answer choices 6.09% 6.39% 5.88% 4.74%
- which one is correct answer please confirm? Q23: The real rate of interest is expected to be 3%, and the expected rate of inflation for next year is expected to be 5.5%. If the default risk premium is 1.1 percentage points, and the seniority risk premium is 0.4 percentage points, what is the required return on a 1-year U.S. Treasury security? a. 9.6% b. 10.0% c. 8.9% d. 8.5%B. J. Gautney Enterprises is evaluating a security. One-year Treasury bills are currently paying 2.9 percent. Calculate the investment's expected return and its standard deviation. Should Gautney invest in this security? Probability Return0.15 -3%0.30 2%0.40 4%0.15 6% The investment's standard deviation is _______ % . round to two decimal placesQ14. Consider a security with a face value of $100,000 to be repaid at maturity. The maturity of the security is 3 years. The coupon rate is 8% per annum and coupon payments are made annually. The current market rate is 8% p.a. What is the security’s duration (round your answer to two decimals)? a. 1.44 years b. 3 half-years. c. 1.39 years. d. 1.39 half-years e. 2.78 years.
- What is the current value of a security that pays P165,500 per year for 10 years if similar investments now earn 10%. a. P1,016,931.30 b. P1,116,931.30 c. P1,006,931.30 d. P1,216,931.30(33). Subject :- Finance You pay $4,000 for a security that you expect will be worth $30,000 exactly 8 years from now. The security will make no intermediate payments. What is the annualized return on this security (3+decimals)?5. Finding the interest rate and the number of years The future value and present value equations also help in finding the interest rate and the number of years that correspond to present and future value calculations. If a security currently worth $12,800 will be worth $16,843.93 seven years in the future, what is the implied interest rate the investor will earn on the security—assuming that no additional deposits or withdrawals are made? 7.60% 0.19% 4.00% 1.32% If an investment of $40,000 is earning an interest rate of 4.00%, compounded annually, then it will take for this investment to reach a value of $53,679.69—assuming that no additional deposits or withdrawals are made during this time. Which of the following statements is true—assuming that no additional deposits or withdrawals are made? It takes 14.21 years for $500 to double if invested at an annual rate of 5%. It takes 10.50 years for $500 to double if invested…