Logo
Home Study Material Contact Search
AI Chat FREE
  1. business
  2. finance
  3. you will be receiving $25,000 at the end of each y

You will be receiving $25,000 at the end of each year for the next 20 years....

Free

70.2K

Verified Solution

Question

Finance

You will be receiving $25,000 at the end of each year for thenext 20 years. If the correct discount rate for such a stream ofcash flows is 10% then what is the present value of the cashflows?

Answer & Explanation Solved by verified expert
3.7 Ratings (512 Votes)

Information provided:

Annuity payments= $25,000

Time= 20 years

Discount rate= 10%

The present value is calculated by entering the below in a financial calculator:

PMT= 25,000

N= 20

I/Y= 10

Press the CPT key and PV to compute the present value.

The value obtained is 212,839.09.

Therefore, the present value is $212,839.09.

In case of any query, kindly comment on the solution.

                                                                                                                                               
Get Answers to Unlimited Questions

Join us to gain access to millions of questions and expert answers. Enjoy exclusive benefits tailored just for you!

Membership Benefits:
  • Unlimited Question Access with detailed Answers
  • Zin AI - 3 Million Words
  • 10 Dall-E 3 Images
  • 20 Plot Generations
  • Conversation with Dialogue Memory
  • No Ads, Ever!
  • Access to Our Best AI Platform: Zin AI - Your personal assistant for all your inquiries!
Become a Member

Transcribed Image Text

You will be receiving $25,000 at the end of each year for thenext 20 years. If the correct discount rate for such a stream ofcash flows is 10% then what is the present value of the cashflows?

Other questions asked by students

Q

What are the adjusting entries for the following?1Accrue interest expense on thenote assuming...What are...

Accounting
Q

If the streak plate is prepared correctly, you will obtain individual colonies True False

Biology
Q

hrough the o a uniform e capacitor e magnetic difference 4 30 A proton a...

Physics
Q

Required information The Foundational 15(Algo)[LO9-1, LO9-2, LO9-4, LO9-5, LO9-6] [The following...

Accounting
Q

Please use this discussion forum to introduce yourself to, and begin learning about, your peers....

Accounting
Q

all part of one problem ...

Accounting
Q

u Meyer reported the following pretax financial income...

Accounting
Q

You are evaluating a project for The Tiff-any golf club, guaranteed to correct that nasty...

Accounting
Q

Kent Corp. has fixed costs of $25,000. Kent expects profit of $300,000 at its anticipated...

Accounting
Q

Flexible Budgeting and Variance Analysis I Love My Chocolate Company makes dark chocolate and light...

Accounting
Q

If we want to understand an individual asset's risk premium as a function of its...

Finance
Q

Current Attempt in Progress The following three accounts appear in the general ledger of Crane...

Accounting