Using the equations and tables in Appendix 124A of this chapter, determine the answers to each of

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Using the equations and tables in Appendix 124A of this chapter, determine the answers to each of the following independent situations:

a. The future value in two years of \($7,500\) invested today in a certificate of deposit with interest Se compounded annually at 10 percent.

b. The present value of \($9,000\) to be received in five years, discounted at 8 percent.

c. The present value of an annuity of \($22,500\) per year for four years discounted at 12 percent.

d. An initial investment of \($44,220\) is to be returned in six equal annual payments. Determine the amount of each payment if the interest rate is 16 percent.

e. Aproposed investment will provide cash flows of \($9,000\), \($12,000\), and \($10,000\) at the end of Years 1, 2, and 3, respectively. Using a discount rate of 16 percent, determine the present value of these cash flows.

f. Find the present value of an investment that will pay \($9,000\) at the end of Years 8, 9, and 10. Use a discount rate of 12 percent.

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Managerial Accounting

ISBN: 9781618532350

8th Edition

Authors: Morse Hartgraves

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