Q1 - A firm that has sold a building is going to receive
payment in four installments. The buyer has paid $10,000 at
purchase time. The buyer is going to pay $15,000 one year later,
$18,000 two years later, and $21,000 three years later. Find the
present value of the receipts from the sale if the seller wishes to
use a discount rate of 6 percent.
Q2 - An investor deposits $1,000 every year on the same day
in a savings account. The amount in the savings accounts earns 5
percent interest compounded annually,
a) What will the investor's account balance be after the third
deposits
b) What will the investor's account balance be after the tenth
deposits
Q3 - A company has taken out a 3-year bank loan for
$50,000. On the third anniversary of the loan, it is repaid with a
$64,752 payment. What was the interest rate paid by the
company
on this loan?
Q4 - A family has established a trust fund for its
children, attending college, and has paid $101.514 to a
bank. In return, the bak is going to pay the
family $20,000 every year for
the next 6 years. The first payment will be made 1 year from the
day the family paid the bank. What is the interest rate that thic
trust fund will be earning?
Q5 - What is the present value of a stream of receipts of
$10,000 çvery year for the first 6 years and $6,000 every year for
years 7 through 16? Thic discount is 8 percent.
Q1 - A firm that has sold a building is going to receive payment in four installments. The buyer has paid $10,000 at pur
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