Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

You are the beneficiary of a trust fund that will start paying you cash flows in five years. The cash flows will be $21,172

 

You are the beneficiary of a trust fund that will start paying you cash flows in five years. The cash flows will be $21,172 per year, and there will be a total of 43 yearly cash flows paid. If the interest rate is 5.6% per year, what is the value needed in the trust fund now to fund these cash flows?

Step by Step Solution

3.40 Rating (153 Votes )

There are 3 Steps involved in it

Step: 1

To calculate the present value of the cash flows fro... blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image_2

Step: 3

blur-text-image_3

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Accounting Principles

Authors: Jerry Weygandt, Paul Kimmel, Donald Kieso

11th Edition

111856667X, 978-1118566671

More Books

Students also viewed these Finance questions