Fundamentals of Financial Management, Concise Edition (MindTap Course List)
9th Edition
ISBN: 9781305635937
Author: Eugene F. Brigham, Joel F. Houston
Publisher: Cengage Learning
expand_more
expand_more
format_list_bulleted
Question
Chapter 5, Problem 9P
a.
Summary Introduction
To determine: The present values and the future values.
The present value refers to that value which is the current value computed for future amounts based on the discounted rate.
The future value means that value of the investment which will be realized in the future. With the help of the calculation of future value, an analysis of the amount to be invested can be made.
b.
Summary Introduction
To determine: The present values and the future values.
Present Value:
The present value refers to that value which is the current value computed for future amounts based on the discounted rate.
Future Value:
The future value means that value of the investment which will be realized in the future. With the help of the calculation of future value, an analysis of the amount to be invested can be made.
c.
Summary Introduction
To determine: The present values and the future values.
Present Value:
The present value refers to that value which is the current value computed for future amounts based on the discounted rate.
Future Value:
The future value means that value of the investment which will be realized in the future. With the help of the calculation of future value, an analysis of the amount to be invested can be made.
d.
Summary Introduction
To determine: The present values and the future values.
Present Value:
The present value refers to that value which is the current value computed for future amounts based on the discounted rate.
Future Value:
The future value means that value of the investment which will be realized in the future. With the help of the calculation of future value, an analysis of the amount to be invested can be made.
Expert Solution & Answer
Want to see the full answer?
Check out a sample textbook solution
Students have asked these similar questions
Find the following values using the equations and then a financial calculator. Compounding/discounting occurs annually. Do not round intermediate calculations. Round your answers to the
nearest cent.
a. An initial $800 compounded for 1 year at 9%.
$
b. An initial $800 compounded for 2 years at 9%.
$
c. The present value of $800 due in 1 year at a discount rate of 9%.
$
d. The present value of $800 due in 2 years at a discount rate of 9%.
$
Find the following values using the equations and then a financial calculator. Compounding/discounting occurs annually. Do not round intermediate calculations. Round your answers to the nearest cent.
An initial $500 compounded for 1 year at 9%.
$
An initial $500 compounded for 2 years at 9%.
$
The present value of $500 due in 1 year at a discount rate of 9%.
$
The present value of $500 due in 2 years at a discount rate of 9%.
$
ind the following values using the equations and then a financial calculator. Compounding/discounting occurs annually. Do not round intermediate calculations. Round your answers to the nearest cent.
An initial $500 compounded for 1 year at 5%.
An initial $500 compounded for 2 years at 5%.
The present value of $500 due in 1 year at a discount rate of 5%.
The present value of $500 due in 2 years at a discount rate of 5%.
Chapter 5 Solutions
Fundamentals of Financial Management, Concise Edition (MindTap Course List)
Ch. 5 - Prob. 1QCh. 5 - Explain whether the following statement is true or...Ch. 5 - If a firms earnings per share grew from 1 to 2...Ch. 5 - Would you rather have a savings account that pays...Ch. 5 - Prob. 5QCh. 5 - Prob. 6QCh. 5 - Banks and other lenders are required to disclose a...Ch. 5 - Prob. 8QCh. 5 - Prob. 1PCh. 5 - PRESENT VALUE What is the present value of a...
Ch. 5 - FINDING THE REQUIRED INTEREST RATE Your parents...Ch. 5 - Prob. 4PCh. 5 - TIME TO REACH A FINANCIAL GOAL You have 33,556.25...Ch. 5 - Prob. 6PCh. 5 - PRESENT AND FUTURE VALUES OF A CASH FLOW STREAM An...Ch. 5 - LOAN AMORTIZATION AND EAR You want to buy a car,...Ch. 5 - Prob. 9PCh. 5 - PRESENT AND FUTURE VALUES FOR DIFFERENT INTEREST...Ch. 5 - GROWTH RATES Sawyer Corporations 2015 sales were 5...Ch. 5 - EFFECTIVE RATE OF INTEREST Find the interest rates...Ch. 5 - Prob. 13PCh. 5 - Prob. 14PCh. 5 - PRESENT VALUE OF AN ANNUITY Find the present...Ch. 5 - Prob. 16PCh. 5 - EFFECTIVE INTEREST RATE You borrow 230,000; the...Ch. 5 - Prob. 18PCh. 5 - FUTURE VALUE OF AN ANNUITY Your client is 26 years...Ch. 5 - Prob. 20PCh. 5 - EVALUATING LUMP SUMS AND ANNUITIES Kristina just...Ch. 5 - LOAN AMORTIZATION Jan sold her house on December...Ch. 5 - Prob. 23PCh. 5 - Prob. 24PCh. 5 - Prob. 25PCh. 5 - PV AND LOAN ELIGIBILITY You have saved 4,000 for a...Ch. 5 - EFFECTIVE VERSUS NOMINAL INTEREST RATES Bank A...Ch. 5 - NOMINAL INTEREST RATE AND EXTENDING CREDIT As a...Ch. 5 - BUILDING CREDIT COST INTO PRICES Your firm sells...Ch. 5 - Prob. 30PCh. 5 - REQUIRED LUMP SUM PAYMENT Starting next year, you...Ch. 5 - REACHING A FINANCIAL GOAL Six years from today you...Ch. 5 - FV OF UNEVEN CASH FLOW You want to buy a house...Ch. 5 - AMORTIZATION SCHEDULE a. Set up an amortization...Ch. 5 - AMORTIZATION SCHEDULE WITH A BALLOON PAYMENT You...Ch. 5 - Prob. 36PCh. 5 - Prob. 37PCh. 5 - Prob. 38PCh. 5 - Prob. 39PCh. 5 - REQUIRED ANNUITY PAYMENTS A father is now planning...Ch. 5 - Prob. 41SPCh. 5 - Prob. 42IC
Knowledge Booster
Similar questions
- For each of the following situations involving annulties, solve for the unknown. Assume that interest is compounded annually and that all annulty amounts are received at the end of each period. (/= Interest rate, and n = number of years) Note: Use tables, Excel, or a financial calculator. Round your final answers to nearest whole dollar amount. (FV of $1, PV of $1, FVA of $1, PVA of $1, FVAD of $1 and PVAD of $1) 1. 2. 3. 4. 5. Present Value 248, 196 442,750 650,000 175,000 Annuity Amount $ 5,000 80,000 60,000 155,040 8% 11% 10% n = 5 4 10 4arrow_forwardClassify the financial problem. Assume a 4% interest rate compounded annually. Find the value of a $1,000 certificate in 6 years. A. amortizationB.ordinary annuity C.present valueD. sinking fundE.future value Answer the question. (Round your answer to the nearest cent.)arrow_forwardPlease show working. please answer a, b, c and d Find the following values using the equations and then a financial calculator. Compounding/discounting occurs annually. Do not round intermediate calculations. Round your answers to the nearest cent. a. An initial $300 compounded for 1 year at 7%. b. An initial $300 compounded for 2 years at 7%. c. The present value of $300 due in 1 year at a discount rate of 7%. d. The present value of $300 due in 2 years at a discount rate of 7%.arrow_forward
- For each of the following situations involving annuities, solve for the unknown. Assume that interest is compounded annually and that all annuity amounts are received at the end of each period. (/= interest rate, and n= number of years) Note: Use tables, Excel, or a financial calculator. Round your final answers to nearest whole dollar amount. (FV of $1. PV of $1. FVA of $1. PVA of $1. EVAD of $1 and PVAD of $1) 1. $ 2 3 4. 15 Present Value Answer is complete but not entirely correct. Annuity Amount 2.200 145,000 190,000 72.523 45,787 8,784 558,865 480,945 520,000 240,000 8% 1.0% 9% 2.5% 10% n= 5 4 30 8 4arrow_forwardComplete the following using the future value formula or financial calculator. (Do not round intermediate calculations. Round your final answers to the nearest cent.) Time = 4 years Principal = $3,300 Rate = 8% Compounded = Quarterly What is the amount and interest?arrow_forwardFor each of the following situations involving single amounts, solve for the unknown. Assume that Interest is compounded annually. (/- interest rate, and n-number of years) Note: Use tables, Excel, or a financial calculator. Round your final answers to nearest whole dollar amount. (EV of $1. PV of $1. EVA of $1. PVA of $1. EVAD of $1 and PVAD of $1) Present Value Future Value $ 36,018 S 72,000 S 43,718 S S 13,720 $ 4. S 51,746 S 5. 5 22,649 1234 86,000 48,000 180,000 8% 11% 9% n 9 10 11 15arrow_forward
- Find the accumulated value of an investment of $25,000 for 5 years at an interest rate of 5% if the money is a. compounded semiannually; b. compounded quarterly; c. compounded monthly d. compounded continuously. Round answers to the nearest cent. Click the icon to view some finance formulas. ..... a. What is the accumulated value if the money is compounded semiannually? (Round your answer to the nearest cent.) Formulas In the provided formulas, A is the balance in the account after t years, P is the principal investment, r is the annual interest rate in decimal form, n is the number of compounding periods per year, and Y is the investment's effective annual yield in decimal form. nt A A: P = A =Pert Y = -1 nt 1+ Print Donearrow_forward1. If you receive $29 each quarter for 19 years and the discount rate is 0.05, what is the present value? (show the process and can use financial calculator)arrow_forwardPRESENT AND FUTURE VALUES FOR DIFFERENT INTEREST RATES Find the following values. Compounding/discounting occurs annually.a. An initial $200 compounded for 10 years at 4%b. An initial $200 compounded for 10 years at 8%c. The present value of $200 due in 10 years at 4%d. The present value of $1,870 due in 10 years at 8% and at 4%e. Define present value and illustrate it using a time line with data from part d. How arepresent values affected by interest rates?arrow_forward
- Calculate the future value of the following annuities, assuming each annuity payment is made at the end of each compounding period. (FV of $1. PV of $1, EVA of $1, and PVA of $1) (Use tables, Excel, or a financial calculator. Round your answers to 2 decimal places.) 1. Annuity Payment $ 3,700 Annual Rate Interest Period Compounded Invested Future Value of Annuity 7.0% Semiannually 9 years 2. 6,700 8.0% Quarterly 5 years 3. 5,700 12.0% Annually 6 yearsarrow_forwardFor each of the following situations involving single amounts, solve for the unknown. Assume that interest is compounded annually. (i= interest rate, and n = number of years) Note: Use tables, Excel, or a financial calculator. Round your final answers to nearest whole dollar amount. (FV of $1, PV of $1, FVA of $1, PVA of $1, FVAD of $1 and PVAD of $1) 1. 2. 3. 4. 5. Present Value Future Value 80,000 94,000 50,000 200,000 $ $ $ $ $ 31,841 $ 15,762 $ 84,482 $ 13,291 i 7% 8% 9% n 9 16 10 15 1arrow_forwardPRESENT AND FUTURE VALUES FOR DIFFERENT INTEREST RATES Find the followingvalues. Compounding/discounting occurs annually.a. An initial $500 compounded for 10 years at 6%b. An initial $500 compounded for 10 years at 12%c. The present value of $500 due in 10 years at 6%d. The present value of $1,552.90 due in 10 years at 12% and at 6%e. Define present value and illustrate it using a time line with data from Part d. How arepresent values affected by interest ratesarrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
Essentials Of InvestmentsFinanceISBN:9781260013924Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.Publisher:Mcgraw-hill Education,
Foundations Of FinanceFinanceISBN:9780134897264Author:KEOWN, Arthur J., Martin, John D., PETTY, J. WilliamPublisher:Pearson,
Fundamentals of Financial Management (MindTap Cou...FinanceISBN:9781337395250Author:Eugene F. Brigham, Joel F. HoustonPublisher:Cengage Learning
Corporate Finance (The Mcgraw-hill/Irwin Series i...FinanceISBN:9780077861759Author:Stephen A. Ross Franco Modigliani Professor of Financial Economics Professor, Randolph W Westerfield Robert R. Dockson Deans Chair in Bus. Admin., Jeffrey Jaffe, Bradford D Jordan ProfessorPublisher:McGraw-Hill Education
Essentials Of Investments
Finance
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Mcgraw-hill Education,
Foundations Of Finance
Finance
ISBN:9780134897264
Author:KEOWN, Arthur J., Martin, John D., PETTY, J. William
Publisher:Pearson,
Fundamentals of Financial Management (MindTap Cou...
Finance
ISBN:9781337395250
Author:Eugene F. Brigham, Joel F. Houston
Publisher:Cengage Learning
Corporate Finance (The Mcgraw-hill/Irwin Series i...
Finance
ISBN:9780077861759
Author:Stephen A. Ross Franco Modigliani Professor of Financial Economics Professor, Randolph W Westerfield Robert R. Dockson Deans Chair in Bus. Admin., Jeffrey Jaffe, Bradford D Jordan Professor
Publisher:McGraw-Hill Education