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# case 1 almost complete - Q1 How would you choose the...

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Q1. How would you choose the discount rate to apply to these cash flows? Answer: Economic Factors : Inflation, Future expectation, and the I/R for the economy. Risks: Systematic risk, Liquidity, Commodity, Price Risk (even foreign exchange risk) Q4) a) use financial calculator and input information FV= 35,000 N= 6 I/Y= 8.4 PMT= 0 PV= ? 21,572.1 b) FV= 35,000 N= 6 I/Y= ? 11.72% PMT= 0 PV= 18,000 c) FV= 35,000 N= 6 I/Y= ? 5.69788 * 2 = 11.3576 PMT= 0 PV= 18,000 5a. Ordinary Annuity b.N = 6 I/Y = 8.4 PV = 0 PMT = 3000 FV = ? = 22230.94 c.N = 6 I/Y = 8.5764 PV = 0 PMT=3000 FV = ? = 22330.08 press 2 nd ICONV = 8.4 C/Y = 2 EFF = ? = 8.5764 d. N=6 I/Y = 8.4 PV = 0 FV = -35000 PMT = ? = 4723.15 e. N=6 I/Y=8.4 PMT = 0 FV = -22230.94 PV = 13701.94 f. annual P/Y = 2 C/Y= 1 I/Y=8.4 N = 12 PMT = 1500 FV= ? =22688.38

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semiannual P/Y = 2 C/Y= 2 I/Y=8.4 N = 12 PMT = 1500 FV= ? = 22799.01 quarterly P/Y = 2 C/Y= 4 I/Y=8.4 N = 12 PMT = 1500 FV= ? = 22856.88 Q7A. Now consider the schedule of payments from Table 1.
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## This note was uploaded on 04/20/2008 for the course FIN 3123 taught by Professor Qayyum during the Spring '08 term at Mississippi State.

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case 1 almost complete - Q1 How would you choose the...

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