Question

What single amount, at the end of the fourth year, is equivalent to a uniform annual...

What single amount, at the end of the fourth year, is equivalent to a uniform annual series of $5,000 per year for 10 years, if the interest rate is 8% per year, compounded  annually?

* Answer to expert question. This is what was given so not sure on your question about cash flows.

Homework Answers

Answer #1
Interest Rate = 8%
Time Period = 10 Years
Annual Series Payment = $ 5,000
Present Value of Series = $ 5,000 * PVAFdue(8%,10 years)
Present Value of Series = $ 5,000 * 7.2475
Present Value of Series(at the beginning of Year1) = $ 36,237.5
Single amount at the end of 4th year = $ 36,237.5 * FV(8%,4 Years)
Single amount at the end of 4th year = $ 36,237.5 * (1+0.08)^4
Single amount at the end of 4th year = $ 36,237.5 * 1.3605
Single amount at the end of 4th year = $ 49,300.72
Computation of PVAFdue:
r 1+r (1+r)^-(n-1) 1- [(1+r)^-n] [1- [(1+r)^-n]] /r P{1+ [1- [(1+r)^-n]] /r}
8% 1.0800 0.5002 0.4998 6.2475 7.2475
Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
What single amount, at the end of the fourth year, is equivalent to a uniform annual...
What single amount, at the end of the fourth year, is equivalent to a uniform annual series of $5,000 per year for 10 years, if the interest rate is 8% per year, compounded annually?
Royalty payments (discrete end of period) for the next 15 years will be $5,000 per year...
Royalty payments (discrete end of period) for the next 15 years will be $5,000 per year for the first 5 years, $9,000 per year for the next 4 years and $12,000 per year for the last 6 years. What uniform annual payment for the next 15 years is equivalent to the described non-uniform series of royalty payments assuming 10% is compounded annually?
You anticipate a cash flow of $900 at the end of year 1, $600 at the...
You anticipate a cash flow of $900 at the end of year 1, $600 at the end of year 2, and $500 at the end of year 4. What is the annual equivalent of the cash flow for years 1 through 4? In other words, what constant value “A” could you receive at the end of years 1-4 such that the two cash series of flows are economically equivalent? The interest rate is 6% annual compounded annually.​
8. ABC Company has a loan that requires a single payment of $5,000 at the end...
8. ABC Company has a loan that requires a single payment of $5,000 at the end of 5 years. The loan's interest rate is 8%, compounded semiannually. How much did ABC Company borrow? 9. Information about an equipment purchase is given below: Cost $ 159,200 Salvage value $ 4,800 Estimated useful life 4 years Annual net cash flows $ 46,900 Depreciation method Straight-line What is the annual average investment amount that should be used to calculate the accounting rate of...
What is the equal payment series for 10 years that is equivalent to a payment series...
What is the equal payment series for 10 years that is equivalent to a payment series of P12,000 at the end of the first year, decreasing by P1000 each year over 10 years. Interest is 8%, compounded annually.
Find the equivalent uniform annual worth of the following cash flow. Assume the interest rate of...
Find the equivalent uniform annual worth of the following cash flow. Assume the interest rate of 7.78% per year compounded quarterly. Project A First cost $1,000,000 Annual operating cost $100,000 Annual income $150,000 Overhaul cost every 5 years $200,000 Salvage value $400,000 Life in years 40 years
For what effective annual interest rate will an uniform cash flow of $1000 per year for...
For what effective annual interest rate will an uniform cash flow of $1000 per year for 10 years be equivalent to a present amount of 8,982.6? 0.5% 1.0% 2.0% 3.0% 4.0%
Compute an equivalent annual cost over a single 5 year maintenance cycle. MARR is 10% per...
Compute an equivalent annual cost over a single 5 year maintenance cycle. MARR is 10% per year compounded annually. End of Year Maintenance cost 1 20 million 2 30 million 3 30 million 4 30 million 5 80 million
Year Amount of cash flow 1-4 $25,000 per year (payments at the end of the year)...
Year Amount of cash flow 1-4 $25,000 per year (payments at the end of the year) 5-9 $20,000 per year (payments at the end of the year) Assume an interest rate of 6% compounded annually. Calculate the present value of the stream of cash flows above. Use .5919 as the PV factor
) What is the future value at the end of year 13 of a series of...
) What is the future value at the end of year 13 of a series of deposits that starts at $6,000 in year 1 and shrinks by 7% per year for 13 years (last deposit occurs at the end of year 13)? The annual interest rate is 7% compounded annually. please answer in excel
ADVERTISEMENT
Need Online Homework Help?

Get Answers For Free
Most questions answered within 1 hours.

Ask a Question
ADVERTISEMENT