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lina2011 [118]
1 year ago
13

what is the present value of a deferred perpetuity that pays $141 annually with the first payment occurring at year 5? assume th

e annually compounded interest rate is 6%.
Business
1 answer:
yKpoI14uk [10]1 year ago
3 0

The present value of a deferred perpetuity is $1,938.89.

What is present value?
The present value of a prospective sum of money or cash flow stream given a specified return rate is known as its present value (PV). The present value of future cash flows is reduced by the discount rate, and the higher coupon rate, the lower the present value of future cash flows. The key to correctly valuing future cash flows, whether they are earnings or debt obligations, is determining the appropriate discount rate. The concept of present value states that a quantity of funds today is worth greater than the same amount in the long term. In other words, money gained in the long term is not as valuable as money received today.

The present value of a deferred perpetuity that pays $141 annually with the first payment occurring at year 5 is $1,938.89. This can be calculated by taking the present value of an ordinary annuity formula, which is PV = A / (1 + r)^n, and adding 5 to n. This gives the equation PV = A / (1 + r)^(n + 5), which can be simplified to PV = A / (1 + r)^n * (1 + r)^5. Thus, the present value is $141 / (1 + 0.06)^10 * (1 + 0.06)^5, which equals $1,938.89.

To learn more about present value
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Explanation:

Since in the question it is mentioned that the 60 year old man have a lung cancer so he sues the asbestos manufacturer also he trust that it is unsafe as her friend who use the alternative material has not have a lung cancer so here the case would be weak as of proximate cause as it is difficult for proving it

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8 0
3 years ago
In March, Kelly Company had the following unit production costs: materials $12 and conversion costs $8. On March 1, it had zero
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Answer:

A) the total units to be accounted for = 23,980 + 4,600 = 28,580 units

B) the total material equivalent units = 23,980 finished units + 4,600 = 28,580 units

total conversion equivalent units = 23,980 finished units + (4,600 x 30%) = 23,980 + 1,380 = 25,360

C) cost reconciliation schedule:

Cost accounted to finished goods 23,980 x (12 + 8) = $479,600

Cost of material in process  

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<u>                                                                                                  $66,240   </u>

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3 0
3 years ago
In which core leader competency do you determine information sharing strategies?
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<span>Communication is the core leader competency in which you determine information sharing strategies.
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4 0
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Based on the information given the car dealer is engaging in what is called Exclusive dealing because the dealer is only selling a particular brand products from a particular company.

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3 0
2 years ago
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Answer:

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