Answer:
yes, what else do you want to tell me
Answer:
Present Value= 38,554.33
Explanation:
Giving the following information:
The investment promises to pay $10,000 a year in perpetuity. The required rate of return is 10 percent and the first $10,000 payment starts in 10 years.
<u>We will separate the calculation in two different steps. First, we calculate the value ten years from now of the annuity. Then we calculate the present value.</u>
The present value of the annuity (10 years from now):
PV= Cf/i
Cf= cash flow
PV= 10,000/0.10= 100,000
Now, we calculate the value today:
PV= FV/ (1+i)^n
PV= 100,000/ 1.10^10= 38,554.33
Answer:
Risk Premium
Explanation:
The Excess rate received over the risk free rate to a investor who invested in a risky asset is known as Risk premium. The concept of High Risk High Reward and Low Risk Low Reward applicable here. As in risky investment the investor is exposed to the risk of loss so, he/she requires some extra return for this exposure. Investing in risk free rate is much safer than in a risky investment.
Answer:
The rate paid for the use of credit
Explanation:
When making a credit card payment, you must pay the bank the amount that you spent during the month, plus an interest rate, which will vary depending on how much you spend with the credit card, and the interest rate could vary based on your credit score, or dependability on paying your loans.
Hope this helps!