what is the present value of the fiollowing payments if the interest rate is 10%? course hero

What is the present value of a sum of money?

Free financial calculator to find the present value of a future amount or a stream of annuity payments. home ... Present Value: $558.39. Total Interest: $441.61. Present Value of Periodical Deposits ... in contrast to a different value it will have in the future due to it being invested and compound at a certain rate. Net Present Value. A ...

What is the par value of the 10-year note Marilyn purchased?

1. What is the present value (PV) of the following investments? Payment $150 per quarter starting quarter 1 for 5 years. Interest Rate is 10% per year compounded quarterly. quarterly pmt $150 per quarter rate 10% 2.50% nper 20 pv/npv ($2,338.37) 2. What is the present value (PV) of the following investments?Payment $200 per month starting month 1 for 6 years.

What was the interest rate on Franklin’s 20-year Treasury bond?

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How do you calculate present value of interest?

Key Takeaways The formula for determining the present value of an annuity is PV = dollar amount of an individual annuity payment multiplied by P = PMT * [1 – [ (1 / 1+r)^n] / r] where: P = Present value of your annuity stream. PMT = Dollar amount of each payment. r = Discount or interest rate.

What is the present value of interest payments?

The present value of a bond is calculated by discounting the bond's future cash payments by the current market interest rate. In other words, the present value of a bond is the total of: The present value of the semiannual interest payments, PLUS.

Is present value affected by interest rate?

The discount rate or interest rate can affect the present value of future cash flows. If the discount rate is lower (representing a lower risk and a lower required return), the present value is higher, and vice versa.Sep 30, 2020

What is present value example?

Present value takes into account any interest rate an investment might earn. For example, if an investor receives $1,000 today and can earn a rate of return of 5% per year, the $1,000 today is certainly worth more than receiving $1,000 five years from now.

What is Net Present Value example?

Example: Let us say you can get 10% interest on your money. So $1,000 now can earn $1,000 x 10% = $100 in a year. Your $1,000 now becomes $1,100 next year. So $1,000 now is the same as $1,100 next year (at 10% interest): We say that $1,100 next year has a Present Value of $1,000.

What is the present value of $100 received one year from now with a 10% interest rate?

about $91If the appropriate interest rate is 10 percent, then the present value of $100 spent or earned one year from now is $100 divided by 1.10, which is about $91.

What is the present value of 1000 due in 10 years?

n: This is the number of periods, which is 10 years....As you will see, the present value of $1,000 paid in 10 years can range from $72.54 to $820.35.Discount RateFuture ValuePresent Value13%$1,000$294.5928 more rows

What is the approximate present value of receiving $10000 per year for 10 years if the first receipt is 5 years from today and interest is discounted at 16% annually?

We see that the present value of receiving $10,000 five years from today is the equivalent of receiving approximately $7,440.00 today, if the time value of money has an annual rate of 6% compounded semiannually.