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problems For Time Value Of Money
- Calculate the present value of $100 to be received 10 years from today, assuming an opportunity cost of 9%.
- Calculate the present value $100 to be received 10 years from today, assuming an opportunity cost of 9% and semi-annual discounting.
- Calculate the future value of $200 received today and deposited at 8% for three years.
- Calculate the future value of $200 received today and deposited at 8% for three years quarterly compounding.
- China manufacturing Agents, INC. is preparing a five -year plan. Today, sales are $1,000,000, if the growth rate in sales is projected to be 10% over the next five years. What will be the dollar amount of sales be in year five?
- Aunt Tillie has deposited $33,000 today in an account which will earn 10% annually. She plans to leave the funds in this account for seven years earning interest. If the goal of this deposit is to cover a future obligation of $70,000 what recommendation would you make to Aunt Tillie?
- Calculate the present value of $20,000 perpetuity at a 7% discount rate.
- Calculate the future value of a $2,000 annuity due deposited at 8% compounded annually for each of the next 10 years.
- What is the future value of a $4,000 annuity due deposited at 6% compounded annually for each of the next 8 years?
- What the present value of $300 to be received 9 years from today, assuming an opportunity cost of 7%.
- Calculate the present value of an ordinary annuity of $2,000 each year for seven years deposited at 5%.
- What is the future value of $5000 received today and deposited at 9% for five years?
- Jassem borrows $4,500 at 12% annually compounded interest rate to be repaid in four equal annual installments. What is the actual end-of-year payment? Create the amortization table for this loan?
problems For Bond Valuation
- 1-What is the current price of a $1,000 par value bond maturing in 12 years with a coupon rate of 14 percent that has an YTM of 13 percent?
- 2-What is the market value of a Zero-coupon bond with a par value of $1000 and maturity of 15 years. Required return from a similar risk bond is 15 percent?
- 3- A firm has an issue of 1,000 par value bonds with a 10 percent stated interest rate outstanding. The issue pays interest semiannually and has 5 years remaining to its maturity date. If bonds of similar risk are currently earning 12 percent, the firm’s bond will for?
- 4- A firm has an issue of $1,000 per value bonds with a 12 percent stated interest rate outstanding. The issue pays interest annually and has 10 years remaining to its maturity date. If similar risk rate are currently earning 8 percent, the firm’s bond will sell for?
- Calculate value of a bond paying quarterly coupon, with par value of $1,000 coupon rate of 6% and maturity of 2 years. Market rate is 8%.
- A bond with par value of $1000, coupon rate of 10%, is now selling for $1,079.85, yield to maturity for this bond is 8%. Calculate the maturity of this bond?
- Find the value of a 30-years zero-coupon bond with a $1,000 par value and YTM of 6%?
- The bond has 8% coupon rate (semi-annual interest), a maturity value of $1000 matures in 5 years and current price of $1200. What is the bond yield to maturity?
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