Question
1. Assuming an interest rate of 5.9 percent, what is the value of the following cash flows today? Round your answer to four decimal places.
1. Assuming an interest rate of 5.9 percent, what is the value of the following cash flows today? Round your answer to four decimal places. Year Cash Flow 1 $ 159 2 198 3 277
2. Your parents will give you $220 every month for 4 years starting from the last day of this month. Suppose the annual interest is 6.1 percent, but compounded monthly. If you saved every penny of your allowance every month, how much will you have in four years? Round your answer to FOUR decimal places. (Hint: payment period: END)
3.
Uncle Frodo left you a pension trust that will pay you $5,343 per quarter for the next 23 years with the first payment received one quarter from today. If the annual interest rate is 6.9 percent, but compounded quarterly, what is the value of the payments today? Round your answer to FOUR decimal places.
4. What is the effective annual rate for an APR of 11.7 percent compounded monthly? Round your answer to FOUR decimal places. For example, if your answer is 0.2525, or 25.25%, your answer should be 0.2525
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started