Answered step by step

Verified Expert Solution

Link Copied!

Question

1 Approved Answer

Posted on May 22, 2024

You have just purchased an investment that generates the following cash flows for the next four years. You are able to reinvest these cash flows

You have just purchased an investment that generates the following cash flows for the next four years. You are able to reinvest these cash flows at 13.5 percent, compounded annually.

End of year

1.$3,207

2.$1,623

3.$3,779

4.$1,770

What is the present value of this investment if 13.5 percent per year is the appropriate discount rate?

Round the answer to two 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

Recommended Textbook for

Fundamentals of Futures and Options Markets

Authors: John C. Hull

8th edition

978-1292155036, 1292155035, 132993341, 978-0132993340

More Books

Students explore these related Finance questions

Question

Runnals National Bank has experienced the following trends over the past five years (all figures in millions of dollars): Input Area: 1 2 3 4 5 Net Income (after tax) 2.65 2.75 3.25 3.65 4.00 Total...

Answered: 3 weeks ago

Question

Complete the tournament sort of the list 22, 8, 14, 17, 3, 9, 27, 11. Show the labels of the vertices at each step. The tournament sort is a sorting algorithm that works by building an ordered binary...

Answered: 3 weeks ago

Question

Explain the concepts involved in Kurt Lewins force-field theory? LO.1

Answered: 3 weeks ago

Question

2. To develop thinking, children have to be mentally, physically, and linguistically active. They need to experiment with, talk about, describe, reflect on, write about, and solve problems. But they...

Answered: 3 weeks ago

Question

A small vessel was purchased by a chemical company for $55,000 and is to be depreciated by MACRS depreciation . When its requirements changed suddenly, the chemical company leased the vessel to an...

Answered: 3 weeks ago

Question

Refer to the following selected financial information from Hansen's, LLC. Compute the company's profit margin for Year 2. Year 2 Net sales $478,500 Cost of goods sold 276,300 9.700 Interest expense...

Answered: 3 weeks ago

Question

Megan Flanigan is a loan officer with L. B. Mortgage Company. She offers a loan of $60,000 to a borrower at 9.6% annual interest, compounded monthly. a. What should she tell the borrower the monthly...

Answered: 3 weeks ago

Question

1) Gerhan Company's flexible budget for the units manufactured in May shows $15,650 of total factory overhead; this output level represents 70% of available capacity. During May, the company applied...

Answered: 3 weeks ago

Question

Answered: 3 weeks ago

Question

Look at the test script test.py. You can see that there is space for an additional test case in the test procedure test_avg. We want you to test the function on range(10,20). To do this: Create a...

Answered: 3 weeks ago

Question

At this stage of the PLC , the brand manager is likely to cut back on advertising a bit and increase sales promotions, though ultimately would, most likely, lower prices: introduction early growth...

Answered: 3 weeks ago

Question

Over the next seven years a well - to - do relative has promised to give you $ 2 , 2 5 0 every month. The first payment is received one - month from today. Assume the relevant interest rate is equal...

Answered: 3 weeks ago

Question

According to the announcement, from the Covid hearing in the European parliament, Pfizer stated that the vaccine had never been tested on stopping the transmission of the virus, this removes the...

Answered: 3 weeks ago

Question

Everything else held constant, if market interest rates are expected to fall in the future, the demand for long-term bonds will ________ and demand for short term bonds will _______. A) rise; rise B)...

Answered: 3 weeks ago

Question

Highland Theatre is owned by Finnean Ferguson. At June 30, 2014, the ledger showed the following: Cash, $6,000; Land, $100,000; Buildings, $80,000; Equipment, $25,000; Accounts Payable, $5,000;...

Answered: 3 weeks ago

Question

The value of business personal property at Jennifer's business fluctuates periodically, which is due largely to fluctuations in the value of inventory on hand. Jen- nifer's property insurance policy...

Answered: 3 weeks ago

Question

Never-Die Battery manufactures batteries for indus- trial and consumer use. The company purchased a commercial package policy (CPP) to cover its prop- erty exposures. In addition to common policy...

Answered: 3 weeks ago

Question

Identify the major liability loss exposures of business firms.

Answered: 3 weeks ago

Previous Question Next Question