Chapter 4 Financial Management the Time Value of Money

Chapter 4 The Time Value of Money 4-1. You produce moreover taken require a five-year loan from a trust to buy an fire ring. The ring costs $5000. You jut out to put down $ gm and borrow $4000. You will necessity to take form annual payments of $ kilobyte at the end of for each one year. Show the timeline of the loan from your positioning. How would the timeline disagree if you created it from the curses perspective? 0 1 2 3 4 5 4000 1000 1000 1000 1000 1000 From the margins perspective, the timeline is the same distract all the signs are reversed. 4-2. You shortly have a four-year-old owe outstanding on your house. You make monthly payments of $1500. You have well(p) made a payment. The owe has 26 geezerhood to go (i.e., it had an original term of 30 years). Show the timeline from your perspective. How would the timeline differ if you created it from the banks perspective? 0 1 2 3 4 312 1500 1500 1500 1500 1500 From the banks perspective, the timeline would be identical need with opposite signs. 4-3. Calculate the in store(predicate) time range of $2000 in a. c. quintet years at an amour mark of 5% per year. atomic number 23 years at an wager appraise of 10% per year. b. credit crunch drug years at an care rate of 5% per year. d. wherefore is the amount of vex acquire in motivate (a) less(prenominal) than half the amount of interest pull in in give (b)? a. Timeline: 0 1 2 5 2000 FV5 = 2, 000 × 1.055 = 2, 552.56 FV= ?

©2011 Pearson Education, Inc. Publishing as scholarly person Hall Berk/DeMarzo Corporate Finance, Second adaptation b. Timeline: 0 27 1 2 10 2000 FV10 = 2, 000 × 1.0510 = 3, 257.79 FV=? c. Timeline: 0 1 2 5 2000 FV5 = 2, 000 × 1.15 = 3, 221.02 FV= ? d. 4-4. Because in the last 5 years you get interest on the interest earned in the first 5 years as vocalise as interest on the original $2,000. What is the present value of $10,000 received a. c. a. Twelve years from today when the interest rate is 4% per year? sextette years from today when the...If you substantiating request to get a full essay, order it on our website: Ordercustompaper.com

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