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The Time Value of Money

Chart question

This problem involves a contract where someone receives money every few months for a certain length of time and then wants to sell the contract for an arbitrage oppurtunity. Anyone can buy or sell a contract that entitles the owner (buyer) to receive $80.00 every six months for the next two years (payments made at the end of

Interest Rates

1/ In fifteen years you need $1,000,000 to move to Fiji. Ten years from now you can invest in a five year investment that pays 12% interest compounded quarterly. Five years from now you can invest in a five year investment that pays 10.5% compounded semiannually. If you are able to earn 8.25% interest compounded monthly for the

Future Amount

The amount of money that would need to be invested today at a given interest rate over a specified period in order to equal a future amount is called _______. future value, present value, future value interest factor, or present value interest factor I believe the answer is - future value interest factor - please advise a

Normal distributions , TVM

1.Consider the normal distributions drawn below (with different scales) They both have m = 20 and the area of the shaded region of each is 0.90. Which of the following holds? a. x1 < x2 b. x1 > x2 c. x1 = x2 d. There is not enough information e. x1 ³ x2 2.If you deposit $5000 into a fund paying 6% interest compound

Time value of money

Provide two examples of real world situations that apply the time value of money concepts.

Finance Future value/ Present value

Assume you intend to retire 25 years from today. During your retirement years you need to have an annual income flow of $86,000 per year for 15 years with the amount occurring exactly 25 years from today. On the 15th year of retirement, in addition to the lump sum, you need an additional $150,000 for miscellaneous purposes. You

Future Value

If we assume that the interest rate is 4%. And the inflation will be 3%. The salary is $40,000 and the time period is 25 years. What is the future value of the salary in 25 years? Please show the calculations. Will this amount be enough to live on in 25 years?

Time value of money, NPV, IRR

1. XYZ has decided to join a national franchise. Annual year-end cash flow is expected to increase by $10,000. At a 12 percent effective required return, what is the value of the franchise affiliation? 2. XYZ purchased new 20-year 6% bonds of BMC Corporation for $100,000 each when they were issued two years ago. I

What is the value of one ordinary share of the company?

I am evaluating a company. It is considered to be 2002, and this time, the company & the whole industry is considered unprofitable. The company doesn't pay dividends on its common shares. I have decided to value the company using my forcasts of FCFE and assume: * The company has 17 billion outstanding shares * Sales will

Future value

What is the future value of $1000 invested today if it earns 10% interest for 1 year? 2 years?

Writing a paper on reducing cost and size of hardware with time

Where can I find information to complete this paper? Prepare a 2-3 page paper (350 words per page) explaining the following: What are the implications for management of each of the following trends: reduction in cost of hardware with time? reduction in size of hardware with time? increase in power of hardware with time?

8 Finance Quetsions

1. Interest rates on 1-year Treasury securities are currently 5.6 percent, while 2-year treasury securities are yielding 6 percent. If the pure expectations theory is correct, what does the market believe will be the yield on 1- year securities 1 year from now? 2. Assume that at the beginning of 1981 the expected inflation r

Income statements, ending net fixed assets, earnings before interest and taxes, cash flow to creditors, return on assets, compounding, interest rates, perpetuity, APR, EAR, present value of the bond's face value, zero coupon bond, implicit interest rate, interest rate risk, current yield, years to maturity

Complete question in the attached file. PLEASE CHOOSE YOUR ANSWER AND EXPLAIN BRIEFLY WHY YOU MADE THAT CHOICE. 1. Suppose you have the 2001 income statement for a firm, along with the 12/31/2000 and 12/31/2001 balance sheets. How would you calculate net capital spending? A) Ending net fixed assets (2001) minus beginnin