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Posted on Sep 08, 2024

Using a present value table (Table 6-4 and Table 6-5), calculate the present value for the following: (Use appropriate factor(s) from the tables provided.) Required:

Using a present value table (Table 6-4 and Table 6-5), calculate the present value for the following: (Use appropriate factor(s) from the tables provided.) Required: a. A car down payment of $50,000 that will be required in five years, assuming an interest rate of 12%. Present value b. A lottery prize of S6 million to be paid at the rate of $300,000 per year for 20 years, assuming an interest rate of 4%. Present Value c. The same annual amount as in part b, but assuming an interest rate of 6%. Present value d. A capital lease obligation that calls for the payment of $8,000 per year for 10 years, assuming a discount rate of 18% Present value TABLE 6.5 FACTORS FOR CALCULATING THE PRESENT VALUE OF AN ANNUITY OF SI Discount Rate No. of Periods 2% 4% 8% 10% 12% 14% 16% 18% 20% 1 2 3 4 0.980 1.942 2.884 3.808 4.713 0.9615 1.8861 2.7751 3.6299 4.4518 0.9434 1.8334 2.6730 3.4651 4.2124 0.9259 1.7833 2.5771 3.3121 3.9927 0.9091 1.7355 2.4869 3.1699 3.7908 0.8929 1.6901 2.4018 3.0373 3.6048 0.8772 1.6467 2.3216 2.9137 3.4331 0.8621 1.6052 2.2459 2.7982 3.2743 0.8475 1.5656 2.1743 2.6901 3.1272 0.8333 1.5278 2.1065 2.5887 2.9906 5 6 7 8 9 10 5.601 6.472 7.325 8.162 8.983 5.2421 6.0021 6.7327 7.4353 8.1109 4.9173 5.5824 6.2098 6.8017 7.3601 4.6229 5.2064 5.7466 6.2469 6.7101 4.3553 4.8684 5.3349 5.7590 6.1446 4.1114 4.5638 4.9676 5.3282 5.6502 3.8887 4.2883 4.6389 4.9464 5.2161 3.6847 4.0386 4.3436 4.6065 4.8332 3.4976 3.8115 4.0776 4.3030 4.4941 3.3255 3.6046 3.8372 4.0310 4.1925 11 12 13 14 15 9.787 10.575 11.348 12.106 12.849 8.7605 9.3851 9.9856 10.5631 11.1184 7.8869 8.3838 8.8527 9.2950 9.7122 7.1390 7.5361 7.9038 8.2442 8.5595 6.4951 6.8137 7.1034 7.3667 7.6061 5.9377 6.1944 6.4235 6.6282 6.8109 5.4527 5.6603 5.8424 6.0021 6.1422 5.0286 5.1971 5.3423 5.4675 5.5755 4.6560 4.7932 4.9095 5.0081 5.0916 4.3271 4.4392 4.5327 4.6106 4.6755 16 17 18 19 20 13.578 14.292 14.992 15.678 16.351 11.6523 10.1059 12.1657 10.4773 12.6593 10.8276 13.1339 11.1581 13.5903 11.4699 8.8514 9.1216 9.3719 9.6036 9.8181 7.8237 8.0216 8.2014 8.3649 8.5136 6.9740 7.1196 7.2497 7.3658 7.4694 6.2651 6.3729 6.4674 6.5504 6.6231 5.6685 5.7487 5.8178 5.8775 5.9288 5.1624 5.2223 5.2732 5.3162 5.3527 4.7296 4.7746 4.8122 4.8435 4.8696 21 22 23 24 17.011 17.658 18.292 18.914 14.0292 11.7641 14.4511 12.0416 14.8568 12.3034 15.2470 12.5504 10.0168 10.2007 10.3711 10.5288 8.6487 8.7715 8.8832 8.9847 7.5620 7.6446 7.7184 7.7843 6.6870 6.7429 6.7921 6.8351 5.9731 6.01 13 6.0442 6.0726 5.3837 4.8913 5.4099 4.9094 5.4321 4.9245 5.45094.9371 TABLE 6.4 FACTORS FOR CALCULATING THE PRESENT VALUE OF SI Discount Rate No. of Periods 2% 4% 6% 8% 10% 12% 14% 16% 18% 20% 2 3 4 5 0.980 0.961 0.942 0.924 0.906 0.9615 0.9246 0.8890 0.8548 0.8219 0.9434 0.8900 0.8396 0.7921 0.7473 0.9259 0.8573 057938 0.7350 0.6806 0.9091 0.8264 0.7513 0.6830 0.6209 0.8929 0.7972 0.7118 0.6355 0.5674 0.8772 0.7695 0.6750 0.5921 0.5194 0.8621 0.7432 0.6407 0.5523 0.4761 0.8475 0.7182 0.6086 0.5158 0.4371 0.8333 0.6944 0.5787 0.4823 0.4019 6 7 8 0.888 0.871 0.853 0.837 0.820 0.7903 0.7599 0.7307 0.7026 0.6756 0.7050 0.6651 0.6274 0.5919 0.5584 0.6302 0.5835 0.5403 0.5002 0.4632 0.5645 0.5132 0.4665 0.4241 0.3855 0.5066 0.4523 0.4039 0.3606 0.3220 0.4556 0.3996 0.3506 0.3075 0.2697 0.4104 0.3538 0.3050 0.2630 0.2267 0.3704 0.3139 0.2660 0.2255 0.1911 0.3349 0.2791 0.2326 0.1938 0.1615 9 10 11 12 13 14 15 0.804 0.788 0.773 0.758 0.743 0.6496 0.6246 0.6006 0.5775 0.5553 0.5268 0.4970 0.4688 0.4423 0.4173 0.4289 0.3971 0.3677 0.3405 0.3152 0.3505 0.3186 0.2897 0.2633 0.2394 0.2875 0.2567 0.2292 0.2046 0.1827 0.2366 0.2076 0.1821 0.1597 0.1401 0.1954 0.1685 0.1452 0.1252 0.1079 0.1619 0.1372 0.1163 0.0985 0.0835 0.1346 0.1122 0.0935 0.0779 0.0849 16 17 18 19 20 0.728 0.714 0.700 0.686 0.673 0.5339 0.5134 0.4936 0.4746 0.4564 0.3936 0.3714 0.3503 0.3305 0.3118 0.2919 0.2703 0.2502 0.2317 0.2145 0.2176 0.1978 0.1799 0.1635 0.1486 0.1631 0.1456 0.1300 0.1161 0.1037 0.1229 0.1078 0.0946 0.0829 0.0728 0.0930 0.0802 0.0691 0.0596 0.0514 0.0708 0.0800 0.0508 0.0431 0.0365 0.0541 0.0451 0.0376 0.0313 0.0261 21 22 23 24 25 0.680 0.647 0.634 0.622 0.610 0.4388 0.4220 0.4057 0.3901 0.3751 0.2942 0.2775 0.2618 0.2470 0.2330 0.1987 0.1839 0.1703 0.1577 0.1460 0.1351 0.1228 0.1117 0.1015 0.0923 0.0926 0.0826 0.0738 0.0859 0.0588 0.0638 0.0560 0.0491 0.0431 0.0378 0.0443 0.0382 0.0329 0.0284 0.0245 0.0309 0.0262 0.0222 0.0188 0.0160 0.0217 0.0181 0.0151 0.0126 0.0105 30 35 40 45 50 0.552 0.500 0.453 0.410 0.372 0.3083 0.2534 0.2083 0.1712 0.1407 0.1741 0.1301 0.0972 0.0727 0.0543 0.0994 0.0676 0.0400 0.0313 0.0213 0.0573 0.0356 0.0221 0.0137 0.0085 0.0334 0.0189 0.0107 0.0061 0.0035 0.0196 0.0102 0.0053 0.0027 0.0014 0.0116 0.0055 0.0026 0.0013 0.0006 0.0070 0.0030 0.0013 0.0006 0.0003 0.0042 0.0017 0.0007 0.0003 0.0001