rps5b_10 - T FINA 4000 handed out Oct 18 due Oct 20 Print...

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Unformatted text preview: , T FINA 4000, handed out Oct 18, due Oct 20 Print Lastname M 1. Consider an annuity that makes 5 payments of $4,000, each two years apart, with the first two years from now. Assume that the discount rate to use is 12%/year. Draw a timeline, setup the math, and compute the PV of this annuity. 0 .2_ ' '_L{.‘ ‘6 If . {OW 700a #000 _ $400.9 , gagged . . 9400:} . r: 0+. iP-Y—i .2591? ‘1/(ZSLfsl—I =. z§¥fi‘/+wv~fw 4 5 Myayaawe’d‘» A:¢/000Awa fm‘W‘ . 10%) = 7000 P ~7( Wife‘s-f5] 2. What is the PV of an annuity that makes 5 payments of $5,000, each one year apart, with the first 4 years from now. Assume that the discount rate to use is 9%/year. Draw a timeline,.setup the math, and compute the PV of this annuity. _. _ l 0 L‘ I . 7. ' 3 '7‘ ‘5" (Q ‘ 7 g? i l t‘ . l W . Q 50 oo 56 00 5030 3000 5000 W3 ‘ ’ ‘ ' ’ ', V2 .= i” ' ' ' Po (magi); {biomui _ .. 3. Consider an annuity with 6 payments of $3,000, each Six months apart, Witn tne nrst nueen months from now. Assume that the discount rate to use is 4%/half-year. Draw a timeline, setup the math, and compute the PV of this annuity. . 0 >4, 3%. M £34. ' 2‘4 . 2% 35‘; 3% t 30cc 300a 3000’ 365:» 39% 5000 i 9 Z ' ‘6‘ ‘7’ -—6 ‘ M I («- ( , .. r:' 30690 w ] ’3, ‘ 0“!“ 1 {537%. w; PVV V [5 y __,_ . “if n 72$ 9% I pvq (ii—.oflB/L - :jl___._.__———s '3! 92.790 f0é057g, ...
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