For the cash flows shown, determine the equivalent future worth in year 10 at an interest rate of 2.5% per month, Year 2 3 4 8 9. 10 Cash Inflows, 250 250 250 250 250 250 250 250 250 (a) The compounding period is: (a) The payment period is: (c) The effective interest rate per compounding period is: (d) The effective interest rate per payment period is: (e) The general equation (without numbers) for calculating the equivalent future worth is: (f) After plugging in the numbers, the equation for calculating the equivalent future worth is (calculation is NOT required):
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- Consider each of the following deposit cash flow series. What will the final balance be (future equivalent value) after the final deposit? Assume the account earns 9% interest compounded annually *Use excel*What is the present value of the following cash-flow stream if the interest rate is 4%? Year 1: $170; 2: $370; 3:$270Consider the cash flow series given in the accompanying table. What value of C makes the deposit series equivalent to the withdrawal series at an interest rate of 6% compounded annually?
- What is the present value of the following cash-flow stream if the interest rate is 4%? Year Cash Flow 1 $110 2 310 3 2101. For each of the following cases, calculate the future value of the single cash flow deposited today that will be available at the end of the deposit period if the interest is compounded annually at the rate specified over the given period. Case Single Cash Flows ($) Interest Rate (%) Deposit Period (years) A $100 3.5% 30 B $5,000 10% 25 C $12,500 12% 7 D $23,200 14% 10For the given cash flow, if the equivalent uniform annual payments is $5000 and the interest rate is 25% per year. End of 1 3 4 6. 7. Year Cost 2A 2A+30 2A+60 2A+90 2A+120 2A+150 2A+180 2A+210 2A+240 Determine the amount of (A) ? Determine the equivalent present value?
- By using a linear interpolation of the compound interest factors, find the present value of the following cash flow, assuming the interest rate is 7.7% per year. 0- 50 200 150 100 IllAssume that time is measured in years and that interest rates are constant. A cashflow of amount £1000 is paid each year, with the first payment made at time 1 and the last payment made at time 20. Using a constant effective interest rate of 3% per annum, calculate the present value at time 0 of the cashflows.The following cash flows are all end-of-period values. .. 400 200 400 .. 300 2 3..... 10 Use a 10% nominal interest rate compounded annually to determine the economically equivalent present value, “P," of the payments at time zero, the economically equivalent future value, "F," of the payments at the end of year 10, and the equivalent annual series of end-of-period payments, "A," in years 1-10.
- Find the value of the unknown quantity Z in the following diagram, such that the equivalent cash outflow equals the equivalent cash inflows when i= 18% per year, compounded semiannually. YcarsREQUIRED Calculate the following from the information given below: 4.1.1 Payback Period (expressed in years, months and days). 4.1.2 Accounting Rate of Return on initial investment (expressed to two decimal places). 4.1.3 Internal Rate of Return (expressed to two decimal places) if the net cash inflows are R400 000 per year for five years. Your answer must include two net present value calculations (using consecutive rates/percentages) and interpolation. INFORMATION VRH Ltd is considering the purchase of Machine X, details of which are provided below: Initial investment Net cash inflows: Year R 0 (1 500 000) 1 480 000 2 600 000 3 380 000 4 272 000 5 360 000 The cost of capital is 12%. Depreciation is calculated using the straight-line method. No scrap value is expected for the machine. Ignore taxes.Consider a loan of $10,000 and the following pattern of cash flows. a. What is the interest rate that makes the present worth equal to $0.00? b. Using the interest rate determined in part (a), and leaving the −$10,000 at year 0 in place, determine the equal annual incomes that are equivalent to the gradient series in years 1, 2, 3, and 4?