14. If the interest rate is 10%, what is the present value of a security that pays you $1,100 next year, $1,210 the year after, and $1,331 the year after that?
Q: The real risk-free rate is 2.5% and inflation is expected to be 2.75% for the next 2 years. A 2-year…
A: Given: Real risk free rate = 2.5% Inflation rate = 2.75% Return on assets = 5.95% Maturity risk…
Q: Assume investors are indifferent among security maturities. Today, the annualized 2-year interest…
A: One year Forward rate = [ (1+two year rate)^2 / (1+One year rate) ] - 1
Q: which of the following investments that pay will $5000 in 12 years have a higher price today?
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A: The present value of all cash flows can be used to calculate the current value of an investment.
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A: The term "perpetuity" refers to an endless stream of financial flows. Money's value depreciates over…
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A: A perpetuity is a type of annuity that lasts forever.
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A: The sum of the current value of the cash flow of security after discounting is term as the value of…
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A: Working Note # 1 YTM for Zero Coupon Bond :: 1 Year YTM= (1000/970.76)-1 0.03012073 3.01207%…
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A: Given:
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A: Market rate = 7.4% Inflation rate = 2.6% Risk free rate = 3.1%
Q: If the interest rate is 4 percent, what is the present value of a security that pays you $100 two…
A: “Since you have asked multiple question, we will solve the first question for you. If you want any…
Q: 5. Finding the interest rate and the number of years The future value and present value equations…
A: Present Value is calculated by dividing the future value by the 1+r factor for the given required…
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A: Using PV in excel
Q: What is the present value of a security that will pay $17,000 in 20 years if securities of equal…
A: Present value refers to the value of money today. Sometimes, present value is also known as…
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A: In this question we need to calculate the present value from following details: Future value =…
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A: “Hey, since there are two different questions are posted, we will answer first question. If you want…
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A: Money has time value and value of money change according to the time.
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A: The question is related to the Present Value and time value of Money. The Present Value is…
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A: Future value is total of initial investment plus compound interest on that. Compound interest could…
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A: Given Information One year Treasury Yield = 5.8400% and Yield on Two Year Treasury Security =…
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A: An additional return amount that an investor can earn at the maturity on a purchase of a bond with…
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A: The risk-free rate of return is the theoretical rate of return of an investment with zero risks. The…
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A: Following details are given: Face Value of bond = $1000 Coupon rate = 18.75% Time period = 5 years…
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A: SOLUTION:- Real risk-free rate=2% Inflation rate(IP)=3% this year, 4% next year, and then 3.5%…
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A: Risk free rate = 3.55% Inflation expected = 3.60%
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A: The formula used as follows: Present value=Future value1+rt
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A: Given we are only required to answer the question 10.5
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A: To determine the Investment which have a higher price today, have to calculate the Present Value…
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Q: A 2-year Treasury security currently earns 1.94 percent. Over the next two years, the real risk-free…
A: Maturity risk premium is premium paid on the bond with high maturity bonds compared to similar bonds…
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A: “Since you have asked multiple questions, we will solve the first question for you. If you want any…
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A: Present value (PV) is the current value of a future sum of money or stream of cash flows given a…
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A: Present value is the value of the money in current time that is expected to be received in future…
Q: If we are using annual returns and the YTM of a 10 year bond is 5.3% and the YTM of an11 year bond…
A: YTM for 10 years = 5.3% YTM for 11 Years = 5.4%
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A: Please find the answer to the above question below:
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- If the interest rate is 15%, what is the present value ofa security that pays you $1,100 next year, $1,250 theyear after, and $1,347 the year after that?If the interest rate is 15%, what is the present valueLOADING... of a security that pays you $1100 next year, $1230 the year after, and $1330 the year after that? Present value is $ enter your response here. ( Round your response to the nearest penny.)If the interest rate is 15%, what is the present value of a security that pays you $1,100 next year, $1,250 the year after, and $1,343 the year after that? Present value is $ (Round your response to the nearest penny.)
- N1 what is the value today of a security that will pay you $46 in three years and $87 six years from now? assume the interest rate is 10%.which of the following investments that pay will $5000 in 12 years have a higher price today? A. The security that earns an interest rate it 8.25% B. The security that earns an interest rate of 5.50%?5. Finding the interest rate and the number of years The future value and present value equations also help in finding the interest rate and the number of years that correspond to present and future value calculations. If a security currently worth $9,200 will be worth $15,767.18 seven years in the future, what is the implied interest rate the investor will earn on the security-assuming that no additional deposits or withdrawals are made? O 8.00% O 5.83% 1.71% O 0.24% If an investment of $50,000 is earning an interest rate of 8.00%, compounded annually, then it will take a value of $89,052.92-assuming that no additional deposits or withdrawals are made during this time. Which of the following statements is true-assuming that no additional deposits or withdrawals are made? O If you invest $1 today at 15% annual compound interest for 82.3753 years, you'll end up with $100,000. O If you invest $5 today at 15% annual compound interest for 82.3753 years, you'll end up with $100,000. for…
- 10. Findingthe interest rate and the number of years The future value and present value equations also help in finding the interest rate and the number of years that correspond to present and future value calculations. If a security of $12,000 will be worth $14,292.19 three years in the future, assuming that no additional deposits or withdrawals are made, what is the implied interest rate the investor will earn on the security? 4.50% 4.80% 6.00% 7.20% If an investment of $45,000 is earning an interest rate of 8.50% compounded annually, it will take for this investment to grow to a value of $79,656.40—assuming that no additional deposits or withdrawals are made during this time. Which of the following statements is true, assuming that no additional deposits or withdrawals are made? If you invest $5 today at 15% annual compound interest for 82.3753 years, you’ll end up with approximately $100,000. If you invest $1 today at 15%…Suppose the risk - free interest rate is 4.2%.a. Having $200 today is equivalent to having what amount in one year?b. Having $200 in one year is equivalent to having what amount today?c. Which would you prefer, $200 today or $200 in one year? Does your answer depend on when you need the money? Why or why not?a. Having $200 today is equivalent to having what amount in one year?Having $200 today is equivalent to having Sin one year. (Round to the nearest cent.)10. Finding the interest rate and the number of years The future value and present value equations also help in finding the interest rate and the number of years that correspond to present and future value calculations. If a security of $4,000 will be worth $5,324.00 three years in the future, assuming that no additional deposits or withdrawals are made, what is the implied interest rate the investor will earn on the security? ○ 6.00% ○ 7.50% ○ 10.00% ○ 12.00% If an investment of $35,000 is earning an interest rate of 11.00% compounded annually, it will take value of $58,977.04-assuming that no additional deposits or withdrawals are made during this time. for this investment to grow to a Which of the following statements is true, assuming that no additional deposits or withdrawals are made? If you invest $1 today at 15% annual compound interest for 82.3753 years, you'll end up with approximately $100,000. ○ If you invest $5 today at 15% annual compound interest for 82.3753 years,…
- 5. Finding the interest rate and the number of years The future value and present value equations also help in finding the interest rate and the number of years that correspond to present and future value calculations. If a security currently worth $2,000 will be worth $3,524.68 five years in the future, what is the implied interest rate the investor will earn on the security-assuming that no additional deposits or withdrawals are made? O 12.00% O 1.76% O 0.35% O 5.67% If an investment of $40,000 is earning an interest rate of 8.00%, compounded annually, then it will take for this investment to reach a value of $56,554.46-assuming that no aditional deposits or withdrawals are made during this time. Which of the following statements is true-assuming that no additional deposits or withdrawals are made? O If you invest $1 today at 15% annual compound interest for 82.3753 years, you'll end up with $100,000. O If you invest $5 today at 15% annual compound interest for 82.3753 years, you'll…Which of the following investments that pay will $9,500 in 14 years will have a lower price today? The security that earns an interest rate of 5.50%. The security that earns an interest rate of 8.25%.6. Finding the interest rate and the number of years The future value and present value equations also help in finding the interest rate and the number of years that correspond to present and future value calculations. If a security currently worth $9,200 will be worth $15,767.18 seven years in the future, what is the implied interest rate the investor will earn on the security-assuming that no additional deposits or withdrawals are made? 5.83% O6.40% 8.00% O 1.71 % If an investment of $50,000 is earning an interest rate of 8.00%, compounded annually, then it will take a value of $89,052.92-assuming that no additional deposits or withdrawals are made during this time. for this investment to reach Which of the following statements is true-assuming that no additional deposits or withdrawals are made? An investment of $25 at an annual rate of 10% will return a higher value in five years than $50 invested at an annual rate of 5% in the same time. An investment of $50 at an annual rate of…