Logo
Home Study Material Contact Search
AI Chat FREE
  1. business
  2. finance
  3. need answer asap a.)you own a contract that promis

NEED ANSWER ASAP a.)You own a contract that promises an annuity cash flow of $350...

70.2K

Verified Solution

Question

Finance

NEED ANSWER ASAP

a.)You own a contract that promises an annuity cash flow of $350 year-end cash flows for each of the next 3 years. (Note: The first cash flow is exactly 1 year from today). At an interest rate of 5%, what is the present value of this contract?

b.)You have been accepted into a prestigious private university in Illinois for your doctoral program. Congratulations! Since no one from this school has ever graduated in only 4 years, you anticipate that you will need to make 9 semi-annual tuition payments of $40,000 each with the first cash flow 6 months from today. If you choose to discount these cash flows at an annual rate of 8%, what is the present value cost of tuition to attend your university of choice?

c.)You are about to purchase a new car from a dealer who has a new and unusual payment plan. You have the choice to pay $27,000 cash today or $30,000 in 4 years. If you have the opportunity to borrow the cash price value of the car at a rate of 2% and repay the loan in a lump sum in 4 years, which option should you take and why?

PLEASE ANSWER COPY AND PASTE NOT ATTACHMENT

ANSWER THROUGLY PLEASE

Answer & Explanation Solved by verified expert
Get Answers to Unlimited Questions

Join us to gain access to millions of questions and expert answers. Enjoy exclusive benefits tailored just for you!

Membership Benefits:
  • Unlimited Question Access with detailed Answers
  • Zin AI - 3 Million Words
  • 10 Dall-E 3 Images
  • 20 Plot Generations
  • Conversation with Dialogue Memory
  • No Ads, Ever!
  • Access to Our Best AI Platform: Flex AI - Your personal assistant for all your inquiries!
Become a Member

Other questions asked by students