Question
1. Suppose I want to be able to withdraw $5,000 at the end of five years and withdraw $6,000 at the end of six years,
1. Suppose I want to be able to withdraw $5,000 at the end of five years and withdraw $6,000 at the end of six years, leaving a zero balance in the account after the last withdrawal. If I can earn 5% on my balances, how much must I deposit today to satisfy my withdrawals needs?
2. Consider an annuity consisting of three cash flows of $2,000 each. Assume a 4% interest rate. What is the present value of the annuity if the first cash flow occurs:
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a) Today
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b) One year from today
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c) Two years from today
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d) Three years from today
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e) Five years from today
3. Explain the difference between an historical balance sheet and a pro-forma balance sheet
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Finance For Nonfinancial Managers Beginners Handbook For Finance
Authors: Murugesan Ramaswamy
1st Edition
1516973801, 978-1516973804
