Question

An investment pays $2,050 per year for the first 4 years, $4,100 per year for the...

An investment pays $2,050 per year for the first 4 years, $4,100 per year for the next 5 years, and $6,150 per year the following 9 years (all payments are at the end of each year). If the discount rate is 8.05% compounding quarterly, what is the fair price of this investment?

Work with 4 decimal places and round your answer to two decimal places. For example, if your answer is $345.667 round as 345.67 and if your answer is .05718 or 5.718% round as 5.72.

Possible Answers:

A. $35,593.12

B. $35,222.36

C. $40,042.26

D. $45,974.45

E. $37,076.17

Business   Finance   
0 0
Add a commentTranscribed image text
Next >

Homework Answers

Answer #1

0 0
Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Log In

Sign Up

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
Find internal rate of return of a project with an initial cost of $43,000, expected net...
Find internal rate of return of a project with an initial cost of $43,000, expected net cash inflows of $9,550 per year for 8 years, and a cost of capital of 8.80%. Round your answer to two decimal places. For example, if your answer is $345.667 round as 345.67 and if your answer is .05718 or 5.718% round as 5.72. Group of answer choices 17.13% 14.90% 13.70% 18.32% 14.15%
On January 1, 2013, your brother's business obtained a 30-year amortized mortgage loan for $350,000 at...
On January 1, 2013, your brother's business obtained a 30-year amortized mortgage loan for $350,000 at a nominal annual rate of 7.35%, with 360 end-of-month payments. The firm can deduct the interest paid for tax purposes. What will the interest tax deduction be for 2017? Calculate using at least 4 decimal points and round your answer to two decimal places. For example, if your answer is $345.667 round as 345.67 and if your answer is .05718 or 5.718% round as...
An investment offers $5,200 per year for 20 years, with the first payment occurring one year...
An investment offers $5,200 per year for 20 years, with the first payment occurring one year from now.    If the required return is 7 percent, what is the value of the investment today? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) What would the value today be if the payments occurred for 45 years? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) What would the...
An investment offers $9,200 per year for 17 years, with the first payment occurring one year...
An investment offers $9,200 per year for 17 years, with the first payment occurring one year from now. Assume the required return is 12 percent. What is the value of the investment today? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) Present value            $ What would the value be if the payments occurred for 42 years? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) Present value...
An investment offers $5,100 per year for 10 years, with the first payment occurring one year...
An investment offers $5,100 per year for 10 years, with the first payment occurring one year from now. a. If the required return is 5 percent, what is the value of the investment today? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) b. What would the value today be if the payments occurred for 35 years? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) c. What...
An investment offers $6,500 per year for 20 years, with the first payment occurring one year...
An investment offers $6,500 per year for 20 years, with the first payment occurring one year from now.    If the required return is 7 percent, what is the value of the investment? (Do not round intermediate calculations and round your final answer to 2 decimal places, e.g., 32.16.)   Present value $    What would the value be if the payments occurred for 45 years? (Do not round intermediate calculations and round your final answer to 2 decimal places, e.g., 32.16.)...
The first quarterly payment of $500 in a five-year annuity will be paid 2.5 years from...
The first quarterly payment of $500 in a five-year annuity will be paid 2.5 years from now. Based on a discount rate of 6% compounded monthly, what is the present value of the payments today?                                                                                                                 Interim calculations should be to six decimals; final answer to the nearest cent. 2. A life insurance company pays investors 5% compounded annually on its five-year GICs. For you to be indifferent as to which compounding option you choose, what would the nominal rates have...
You were analyzing a stock and came up with the following probability distribution of the stock...
You were analyzing a stock and came up with the following probability distribution of the stock returns. What is the coefficient of variation on the company's stock? Round your answer to two decimal places. For example, if your answer is $345.6671 round as 345.67 and if your answer is .05718 or 5.7182% round as 5.72. State of the Economy Probability of State Occurring Stock's Expected Return Boom 25.00% 19.90% Normal 51.00% 17.45% Recession 24.00% 8.10%
An investment offers $5,500 per year, with the first payment occurring one year from now. The...
An investment offers $5,500 per year, with the first payment occurring one year from now. The required return is 7 percent. a. What would the value be today if the payments occurred for 20 years? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) b.What would the value be today if the payments occurred for 45 years? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) c.What would...
An investment offers $4,800 per year for 19 years, with the first payment occurring one year...
An investment offers $4,800 per year for 19 years, with the first payment occurring one year from now. If the required return is 11 percent, the present value of the investment is $  . If the payments occurred for 31 years, the present value of the investment would be $  . If the payments occurred for 81 years, the present value of the investment would be $  . If the payments last forever, the present value would be $  (Do not include the dollar...
ADVERTISEMENT
Need Online Homework Help?

Get Answers For Free
Most questions answered within 1 hours.

Ask a Question
ADVERTISEMENT