Purchase Solution

Description of Present Value Calculations

Not what you're looking for?

Ask Custom Question

Calculate the present value for the following questions:

1. $45,000 today in one lump sum.

2. $70,000 paid to you in seven equal payments of $10,000 at the end of each of the next seven years.

3. $80,000 paid in one lump sum 7 years from now

Purchase this Solution
Solution Summary

This solution calculates the present value for 3 different scenarios; 2 of which are lump sums.

Purchase this Solution
Free BrainMass Quizzes
Lean your Process

This quiz will help you understand the basic concepts of Lean.

Writing Business Plans

This quiz will test your understanding of how to write good business plans, the usual components of a good plan, purposes, terms, and writing style tips.

Marketing Management Philosophies Quiz

A test on how well a student understands the basic assumptions of marketers on buyers that will form a basis of their marketing strategies.

Operations Management

This quiz tests a student's knowledge about Operations Management

Change and Resistance within Organizations

This quiz intended to help students understand change and resistance in organizations

View More Free Quizzes
Related BrainMass Solutions

  • Finding out Calculations of NPV, IRR and Contribution Margin

    of net present value, internal rate of return and contribution margin.

  • Calculate Payback Period, Return on Average Investment, NPV

    13.66% C Net present value Description Year Cash flows Discount factor @ 10% Present value Initial cost 0 $(109,000) 1.000 $(109,000) Annual cash flows 1-10 $17,700 6.145 $108,767 Salvage value

  • Evaluate new product launch for manufacturing company: Cash flows, payback, NPV

    NPV- Net present values It tells about the value added by the project. NPV = Present value of Future cashflows - Initial Investments = $14,73,865.52 (Through excel function) Please see excel file for calculations.

  • Need to Calculate ROI and NPV

    308083 Need to Calculate ROI and NPV Customer is considering acquiring a wireless order taking system I need to calculate return on investmen (ROI) and net present value (NPV). The acquisition cost is $35,000 paid at time of installation.

  • Net present value

    of the equipment $200,000 0.519 $103,874 5 Recovery of working capital $100,000 0.519 $51,937 Net present value $(45,079) Since the net present value of the project is negative, the project must not be accepted.

  • Capital budgeting for a Well-Established Coffee Shop

    Calculate the payback period (P/B) and the net present value (NPV) for the project. Answer the following questions based on your P/B and NPV calculations: Do you think the project should be accepted? Why?

  • Time value of money

    The solution explains calculations relating to various time value of money problems

  • Present value of alternatives

    66909 Present value of alternatives (See attached file for full problem description) You have just been hired as a consultant to help a firm decide which of three options to take to maximize the value of the firm over the next three years.

  • Project Selection Criteria

    The projects are mutually exclusive and the net present value (NPV) calculations for each take into account the project's risk. Which project (A or B) would you recommend and explain your reasons for this recommendation.

View More Related Solutions