26.4 kept short. They include only selected discount rates and only extend forPresent Value of $1 Due in n Periods*EXHIBIT 26-3Number ofPresent Value of $1 Payablein n PeriodsDiscount RatePeriods(n)1%12%5%6%8%10%12%15%20%1.990.985.952.943.926.909.893.870.833.980.971.907.890.857.826.797.756.694.971.956.864.840.794.751.712.658.579.961.942.823.792.735.683.636.572.482.951.928.784.747.681.621.567.497.402.942.915.746.705.630.564.507.432.335.933.901.711.665.583.513.452.376.279.923.888.677.627.540.467404.327.233.914.875.645.592.500424.361.284.19410.905.862.614.558.463.386.322.247.16220.820.742.377.312.215.149.104.061.02624.788.700.310.247.158.102.066.035.01336.699585.173.123.063032.017.007.001*The present value of $1 is computed by the formula p = 1/(1 + i)n, where p is the present value of $1, i is the discount rate, and n is the number ofperiods until the future cash flow will occur. Amounts in this table have been rounded to three decimal places and are shown for a limited number ofperiods and discount rates. Many calculators are programmed to use this formula and can compute present values when the future amount is enteredalong with values for i and n.EXHIBIT 26-4Present Value of $1 to Be Received Periodically for n PeriodsPresent Value of a $1 AnnuityDiscount RateNumber ofReceivable Each Period for nPeriods5%6%8%10%12%15%20%Periods1%12%(n)0.9900.9850.9520.9430.926 0.909 0.893 0.8700.8331.9561.8591.8331.7831.736 1.690 1.6261.5281.9702.9122.7232.6732.5772.487 2.402 2.2832.1062.9413.5463.4653.312 3.170 3.037 2.8552.5893.9023.8544.3294.2123.9933.791 3.605 3.3522.9914.8534.7835.0764.9174.6234.355 4.111 3.7843.3265.7955.6975.2064.868 4.564 4.1603.6056.5985.786 5.5826.7286.2105.7475.335 4.968 4.4873.8377.4866.4637.6524.0317.1086.802 6.247 5.759 5.328 4.7728.5668.3614.1927.7227.360 6.710 6.145 5.650 5.0199.4719.2224.8701011.470 9.818 8.514 7.469 6.25917.169 12.4624.9372018.04612.550 10.529 8.985 7.784 6.43421.24320.030 13.7992414.621 11.717 9.677 8.192 6.623 4.99330.10827.661 16.547362 3 4 5 6 7 8 9 으1 2 3 4 5 6 7 8 9으 T Solve for the missing information pertaining to each investment proposal.Using the tables in Exhibits 26–3 and 26–4, determine the present value of the following cashflows, discounted at an annual rate of 15 percent.$40,000 to be received 20 years from today.b. $24,000 to be received annually for 10 years.а.$16,000 to be received annually for five years, with an additional $20,000 salvage valueexpected at the end of the fifth year.с.d. $30,000 to be received annually for the first three years, followed by $20,000 received annu-ally for the next two years (total of five years in which cash is received).

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Solve for the missing information pertainıng lo Using the tables in Exhibits 26–3 and 26-4, determine the present value of the following cash flows, discounted at an annual rate of 15 percent. а. $40,000 to be received 20 years from today. b. $24,000 to be received annually for 10 years. $16,000 to be received annually for five years, with an additional $20,000 salvage value expected at the end of the fifth year. d. $30,000 to be received annually for the first three years, followed by $20,000 received annu- ally for the next two years (total of five years in which cash is received). с.

Solve for the missing information pertainıng lo Using the tables in Exhibits 26–3 and 26-4, determine the present value of the following cash flows, discounted at an annual rate of 15 percent. а. $40,000 to be received 20 years from today. b. $24,000 to be received annually for 10 years. $16,000 to be received annually for five years, with an additional $20,000 salvage value expected at the end of the fifth year. d. $30,000 to be received annually for the first three years, followed by $20,000 received annu- ally for the next two years (total of five years in which cash is received). с.

Corporate Fin Focused Approach

5th Edition

ISBN:9781285660516

Author:EHRHARDT

Publisher:EHRHARDT

Chapter4: Time Value Of Money

Section: Chapter Questions

Problem 1Q

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