31. What is the present value of a four-year annuity of $100 per year that makes its first payment two years from today if the discount rate is 9%? 0 1 2 3 4 5 $100 $100 $100 $100 $323.97 $297.22
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34. PV of Growing Annuity You are evaluating an income property that is providing increasing rents. Net rent is received at the end of each year. The first year's rent is expected to be $8,500 and rent is expected to increase 7% each year. Each payment occur at the end of the year. What is the present value of the estimated income stream over the first 5 years if the discount rate is 12%? $34,706.26 0 1 2 3 4 5
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38. We begin by substituting for PMT and for r becomes
41. We continue to simplify terms. Finally, note that: (1 + r ) – (1 + g ) = r – g
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44. PV of Growing Annuity: BAII Plus PMT I/Y FV PV N 19,417.48 = 6.80 = 0 – 265,121.57 40 PV A defined-benefit retirement plan offers to pay $20,000 per year for 40 years and increase the annual payment by three-percent each year. What is the present value at retirement if the discount rate is 10 percent per annum? 20,000 1.03 1.10 1.03 – 1 × 100
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46. PV of a delayed growing annuity The first step is to draw a timeline. The second step is to decide on what we know and what it is we are trying to find. Year 0 1 2 3 Cash flow $1.50 $1.65 $1.82 4 $1.82×1.05 …
47. PV of a delayed growing annuity Year 0 1 2 3 Cash flow $1.50 $1.65 $1.82 dividend + P 3 PV of cash flow $32.81 = $1.82 + $38.22
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Notes de l'éditeur
e is a transcendental number because it transcends the real numbers.
If you can do this on the first try, you’re an “A” student.
If you can do this on the first try, you’re an “A” student.