View the step-by-step solution to:

present value concept 1. what single investment made today earning 10% annual interest, will be worth $5000 at the end of six years?

This question was answered on Jan 27, 2013. View the Answer
present value concept

1. what single investment made today earning 10% annual interest, will be worth $5000 at the end of six years?

2. What is the present value of $5000 to be received at the end of 6 years if the discount rate is 10%?

3. What is the most you would pay today for a promise to repay you $5000 at the end of 6 years if your opportunity cost 10%?

Compare, contrast, and discuss your findings in parts 1 through 4.

Show formula and work
Sign up to view the entire interaction

Top Answer

Hi Student, please find... View the full answer

8424659.docx

Answer
1. What single investment made today earning 10% annual interest, will be worth
$5000 at the end of six years?
Amount = P
$5,000 = P (1+.1)6
$5,000 / 1.771561 = P
P = $2,822.37
2. What is...

This question was asked on Jan 26, 2013 and answered on Jan 27, 2013.

Recently Asked Questions

Why Join Course Hero?

Course Hero has all the homework and study help you need to succeed! We’ve got course-specific notes, study guides, and practice tests along with expert tutors and customizable flashcards—available anywhere, anytime.

-

Educational Resources
  • -

    Study Documents

    Find the best study resources around, tagged to your specific courses. Share your own to gain free Course Hero access or to earn money with our Marketplace.

    Browse Documents
  • -

    Question & Answers

    Get one-on-one homework help from our expert tutors—available online 24/7. Ask your own questions or browse existing Q&A threads. Satisfaction guaranteed!

    Ask a Question
  • -

    Flashcards

    Browse existing sets or create your own using our digital flashcard system. A simple yet effective studying tool to help you earn the grade that you want!

    Browse Flashcards