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    The Time Value of Money

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    Cash flow - what is the present value of the net investment at time 0?

    Little Giant is building a manufacturing plant that will require a cash outlay of $300,000 for the initial purchase of a building, $450,000 for remodeling the first year, and $710,00 for new equipment in the second year. If the firm's cost of capital is 12 percent, what is the present value of the net investment at time 0? a. $

    Personal Finance

    A) Joe won a lottery jackpot that will pay him $12,000 each year for the next ten years. If the market interest rates are currently 12%, how much does the lottery have to invest today to pay out this prize to Joe over the next ten years? b) Mary just deposited $33,000 in an account paying 10% interest. She plans to leave the

    Future value for various compounding periods

    Future value for various compounding periods. Find the amount to which $500 will grow under each of these conditions: a.12% compounded annually for 5 years b.12% compounded semiannually for 5 yrs c:12 % compounded quarterly for 5 years d: 12 %compounded monthly for 5 yrs e. 12% compounded daily for 5 yrs f. Why does the ob

    Time Value of Money, Retirement Fund

    3. Kay Mart owns an annuity that will begin making semiannual payments of $7500 in perpetuity to her or her heirs. The first payment will take place 3 years and 6 months from today. She is considering selling the annuity to an investor whose required rate of return is 11% EAR. How much will she get for her annuity if she d

    Present Value Problems for Investors

    1. An investor is considering a business opportunity with the following predicted cash flows. Time 0 1 2 3 4 Predicted Cash Flow 2200 6500 8500 X 6400 The investor could earn 10% compounded quarterly on an investment of similar risk. If the investor is willing to pay $26,000 for this business opportunity, what is

    Present Value / Future Value

    Show the formula used in the following questions in detail 1) a. What is the future value of $4,000 invested at 6% for 22 years with annual compounding? b. What is the future value of $4,000 invested at 6% for 22 years with monthly compounding? c. What is the future value of $4,000 invested at 6% for 22 years with cont

    Apply the concept of TVM

    The Acme Company must solve a series of five problems that require you to apply the concept of "time value of money," or TVM. The five problems are listed below. Solving them will require the use of Microsoft Excel. Before you begin your work, each student is to select a unique nine-digit random number that contains no zeros, no

    Time Value of Money

    Identify and describe at least one financial application of Time Value of Money employed by each of the following businesses: Commercial banks Credit card financial service companies Insurance companies State governments - lotteries Retirement plan financial service providers

    Current value of a share

    What is the current value of a share of a common stock to an investor who requires a 12% annual rate of return, if next year's dividend, D1, is expected to be $3 per share and dividends are expected to grow at an annual rate of 4% for the foreseeable future?

    Apply the time value of money in making financial decisions.

    Kim has arranged a meeting with you and the head of manufacturing because she thinks you need to explain to him the time value of money. Kim is concerned that many of the manufacturing projects that have been pursued are based on the payback period and do not recognize that a dollar received 3 years from now is not the same as a

    Time Value of Money

    1. Over the past several years, Helen Chang has been able to save regularly. As a result, today she has $14,188 in savings and investments. She wants to establish her own business in 5 years and fells she will need $50,000 to do so. a. If Helen can earn 12% on her money, how much will her $14,188 be worth in about 5 years

    Future of XML

    What do you see for the future of XML? Obviously, one of the largest problems will be deciding on schemas. How do you think this should be done? Propose a way to manage schemas in different companies, industries, and business in general. What pitfalls can you work around?

    Simple and compound interest; present value concept; and TVM.

    1. Can you explain the difference between "simple" and "compound" interest? Please provide some of the uses of compound interest in business. I also need to know the effects of using compound interest when evaluating future value transactions and calculations. 2. What is "present value"? What is an example of the "present

    Simple and compound interest; present value concept; and TVM.

    1. Explain what is the difference between "simple" and "compound" interest? Provide some of the uses of compound interest in business. What are the effects of using compound interest when evaluating future value transactions and calculations. 2. What is "present value"? What is an example of the "present value" concept? How d

    Important Information about Personal Income Tax

    David and Eliza are married and under 65 years of age. During 2004, they furnish more than half of the support of their 18-year old son, Timothy. Timothy earns $4,000 from a part-time job, most of which he sets aside for future college expenses. During 2004, they also furnish more than half of the support of their 25-year old

    Diversity at Nestle

    You feel that as NL&C grows, the employee base will grow increasingly diverse. With the mindset of doing things right the first time, you plan to present a diversity strategy which emulates the best practices of other companies. You've hear that Nestle is a standard-setter. A friend of yours in HR sends you to the Diversity

    Compounding value

    WHAT IS THE VALUE AT THE END OF YEAR 3 OF THE FOLLOWING CASH FLOW STREAM IF THE QUOTED INTEREST RATE IS 10 PERCENT, COMPOUNDED SEMIANNUALLY? 0 2 4 6 PERIODS | | | | 100 100 100

    Calculate using a financial calculator

    Someone spends $60/acre to plant trees on marginal land. The expected rate of return is 4% and inflation is expected to be 6%. What is the expected value of the timber after 20 years. How would you calculate this using a financial calculator?

    The world of business in the future

    Imagine you are a business executive in the year 2015. How is the business world different than it was when you were a master's degree student in 2006.

    Time value of money: retirement plans

    Ted Gardiner has just turned 30 years old. He has currently accumulated $35,000 toward his planned retirement at age 60. He wants to accumulate enough money over the next 30 years to provide for a 20-year retirement annuity of $100,000 at the beginning of each year, starting with his 60th birthday. He plans to save $5,000 at t

    Time Value of Money

    You are currently 30 years of age. You intend to retire at age 60 and you want to be able to receive a 20-year, $100,000 beginning-of-year annuity with the first payment to be received on your 60th birthday. You would like to save enough money over the next 15 years to achieve your objective; that is, you want to accumulate th

    Determining the future and present values for different periods

    Present and future values for different periods. Find the following values, using the equations and then a financial calculator compounding/discounting occurs annually. a. An initial $500 compounded for 1 year at 6%. b. An initial $500 compounded for 2 years at 6%. c. The present value of $500 due in 1 year at a discount r