Business Finance Math


You are considering the purchase of an investment that would pay you $6,000 per year for Years 1-5, and $4,000 per year for Years 6-7. If you require an 8 percent rate of return, and the cash flows occur at the end of each year, then how much should you be willing to pay for this investment?
Question 2
You are given the following cash flow information. The appropriate discount rate is 4 percent for years 1-4 and 4 percent for years 5-10. Payments are received at the end of the year.
Year Amount Interest Rate
1-4 $8,000 4%
5-10 $11,000 4%

What should you be willing to pay right now to receive the income stream above?
Question 4
A share of common stock has a current price of $85.68 and is expected to grow at a constant rate of 8 percent. If you require a 10 percent rate of return, what is the current dividend, Do, on this stock?
Question 6
Given the following probability distribution, what is the expected return and the standard deviation of returns for Security J?

Save your time - order a paper!

Get your paper written from scratch within the tight deadline. Our service is a reliable solution to all your troubles. Place an order on any task and we will take care of it. You won’t have to worry about the quality and deadlines

Order Paper Now

State Pi Ri
1 40% 10%
2 25% 12%
3 35% 18%

Question 8
General Dynamics has a bond with 30 years to maturity has a face value of $1000. The bond pays a 5 percent semiannual coupon, and the bond has a 7 percent nominal yield to maturity. What is the price of the bond today?


The post Business Finance Math first appeared on COMPLIANT PAPERS.