If you invest $100 at an interest rate of 15%, how much will you have at the end of eight years?
Discount factors if the PV of $139 is $125, what is the discount factor?
Present values if the cost of capital is 9%, what is the PV of $374 paid in year 9?
You have invested $60,476 at 8%. After paying the above school fees, how much would remain at the end of the six years?
Discount factors and present values
a. If the one-year discount factor is .905, what is the one-year interest rate?
b. If the two-year interest rate is 10.5%, what is the two-year discount factor?
c. Given these one- and two-year discount factors, calculate the two-year annuity factor.
d. If the PV of $10 a year for three years is $24.65, what is the three-year annuity factor?
e. From your answers to (c) and (d), calculate the three-year discount factor.