This preview has intentionally blurred sections. Sign up to view the full version.
View Full DocumentThis preview has intentionally blurred sections. Sign up to view the full version.
View Full DocumentThis preview has intentionally blurred sections. Sign up to view the full version.
View Full DocumentThis preview has intentionally blurred sections. Sign up to view the full version.
View Full Document
Unformatted text preview: Business Management 201 Day 11 Chapter 6: Part 1—Bond Valuation October 10, 2011 Day 11 Agenda 1) POW Quiz #6: Citigroup Case & Duration Exercise— Completed Together in Class—Due Friday, October 14 at 11:59 PM 2) Next TA Review Sessions this Week: TA Open Lab Session—Tuesday 2:00 PM3:00 PM in 251 TNRB TA POW Review Session—Tuesday 7:00 PM8:00 PM in 3108 JKB 1) Midterm Exam: October 1921—Study Guide Posted This Week 2) Personal Finance Topics 3) Negotiation Tips 4) POW #5: TVM—Content Blurbs: Question 9 & 10 5) Chapter 6: Part 1 Discussion POW #5: TVM POW #5: TVM Question 9—Annuity Question 9—Annuity What is the present value of a $1,000 annuity for 10 years with the first payment occurring at the end of year 10 (that is, ten $1,000 payments occurring at the end of year 10 through year 19) given an appropriate discount rate of 10 percent ? (round to the nearest dollar) Answer Choices $2,866 $6,145 $2,369 $2,606 POW #5: TVM—Content Blurbs What is the present value of a $1,000 annuity for 10 years with the first payment occurring at the end of year 10 (that is, ten $1,000 payments occurring at the end of year 10 through year 19) given an appropriate discount rate of 10 percent ? (round to the nearest dollar) POW #5: TVM—Content Blurbs 1 2 … 9 1 2 … 9 10 10 11 11 12 12 13 … 19 13 … 19 0 0 0 0 1000 1000 1000 1000 1000 0 0 0 0 1000 1000 1000 1000 1000 This problem will need to be completed in TWO steps using TVM or on your financial calculator using the CF j function. What is the present value of a $1,000 annuity for 10 years with the first payment occurring at the end of year 10 (that is, ten $1,000 payments occurring at the end of year 10 through year 19) given an appropriate discount rate of 10 percent ? (round to the nearest dollar) POW #5: TVM—Content Blurbs STEP 1: PV = ? FV = 0 PMT = 1000 I/Yr = 10 N = 10 PV: $6144.567 STEP 2: PV = ? FV = 6144.567 PMT = 0 I/Yr = 10 N = 9 PV: $2605.896 What is the present value of a $1,000 annuity for 10 years with the first payment occurring at the end of year 10 (that is, ten $1,000 payments occurring at the end of year 10 through year 19) given an appropriate discount rate of 10 percent...
View
Full
Document
 Fall '11
 JennLarson
 Management, Valuation

Click to edit the document details