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loris [4]
4 years ago
11

What is the present value of $540,000 to be paid in 9 years? The annual interest rate is 7%. (FV of $1, PV of $1, FVA of $1, and

PVA of $1) (Use the appropriate factor(s) from the tables provided. Round your answer to the nearest whole dollar.)
Business
1 answer:
puteri [66]4 years ago
3 0

Answer:

$293,724.22

Explanation:

<em>The present value of a single cash flow expected at a future date is its worth today if it is discounted at given rate or return.</em>

This can be determined using the formula below:

PV = FV × (1+r)^(-n)

Where PV = Present Value, FV = Future Value, r - interest rate per period

n - number of periods

PV = $540,000 ×  (1.07)^(-9)

    = $293,724.221

Present Value of $540,000 expected in year 9 =  $293,724.22

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1 year ago
A data analyst at a construction company is working on a report for a quickly approaching deadline. why might they choose to ana
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2 years ago
As you delelop your child care center, you should ensure that children are well taken care of, but are also
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exposed to an environment that entice their curiosity and learning.

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7 0
3 years ago
Which type of business plan is used primarily for the owner and other employees to organize the structure, finances, and plans f
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2 years ago
Gulf Shores Inn is comparing two separate capital structures. The first structure consists of 300,000 shares of stock and no deb
tangare [24]

Answer:

The price per share of equity is $37.083

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The first capital structure is purely equity based and Guld Shores will sell 300000 shares at price x to raise the needed capital.

The second structure is a mixed or leveraged structure where both debt and equity components are involved. The capital that needds to be raised remains constant.

Gulf has to give up 300000 - 252000 = 48000 shares and raise 1.78 million dollars from debt. We assumed that the amount that Gulf will raise is the ame from both th structures. Then 48000 shares at price x are equal to $1.78 million debt.

So, Price per share of equity is,

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1780000 / 48000 = x

x or price per share = $37.083

6 0
4 years ago
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