Question
You agree to take out a loan from the bank and receive funds today. The loan has the following terms: One year from today you
You agree to take out a loan from the bank and receive funds today. The loan has the following terms:
One year from today you will make a payment of $6,000 to the bank;
Two years from today you will receive $2,000 from the bank;
Three years from today you will make a payment of $7,000 to the bank.
If the interest rate is 4.7%, what is the size of the loan (pv) you will receive today from the bank?
Enter you answer as a positive number rounded to 2 decimal places.
The present value of an ordinary annuity is $2,000. If the cost of capital is 7%, what would be the present value if the first payment were not received until the end of year 9?
What is the present value of an ordinary annuity that pays $13,000 annually for 11 years with the first payment being made one year from today? Assume a cost of capital of 9%.
Round your answer to 2 decimal places.
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