14 percent is the discount rate, what is the present value of the cash flows? a. If 7percent is the discount rate, the present value of the annuity due is $ (Round to the nearest cent.) b.If 14 percent is the discount rate, the present value of the annuity due is $ (Round to the nearest cent.)
14 percent is the discount rate, what is the present value of the cash flows? a. If 7percent is the discount rate, the present value of the annuity due is $ (Round to the nearest cent.) b.If 14 percent is the discount rate, the present value of the annuity due is $ (Round to the nearest cent.)
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
Related questions
Question
fin320
|
|
(Related to Checkpoint 6.2) (Present value of annuity payments) The state lottery's million-dollar payout provides for
$1.3 million to be paid in 20 installments of $65,000 per payment. The first
$65,000 payment is made immediately, and the 19 remaining $65,000
payments occur at the end of each of the next 19years. If 7 percent is the discount rate, what is the present value of this stream of cash flows? If
14 percent is the discount rate, what is the present value of the cash flows?
a. If 7percent is the discount rate, the present value of the annuity due is
$ (Round to the nearest cent.)
b.If 14 percent is the discount rate, the present value of the annuity due is
$ (Round to the nearest cent.)
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
This is a popular solution!
Trending now
This is a popular solution!
Step by step
Solved in 3 steps with 2 images
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, finance and related others by exploring similar questions and additional content below.Recommended textbooks for you
Essentials Of Investments
Finance
ISBN:
9781260013924
Author:
Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:
Mcgraw-hill Education,
Essentials Of Investments
Finance
ISBN:
9781260013924
Author:
Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:
Mcgraw-hill Education,
Foundations Of Finance
Finance
ISBN:
9780134897264
Author:
KEOWN, Arthur J., Martin, John D., PETTY, J. William
Publisher:
Pearson,
Fundamentals of Financial Management (MindTap Cou…
Finance
ISBN:
9781337395250
Author:
Eugene F. Brigham, Joel F. Houston
Publisher:
Cengage Learning
Corporate Finance (The Mcgraw-hill/Irwin Series i…
Finance
ISBN:
9780077861759
Author:
Stephen A. Ross Franco Modigliani Professor of Financial Economics Professor, Randolph W Westerfield Robert R. Dockson Deans Chair in Bus. Admin., Jeffrey Jaffe, Bradford D Jordan Professor
Publisher:
McGraw-Hill Education