Calendars ! Acaci × my.usca.edu Chapter 5 Homework (part 1) McGraw-Hill Connect

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Calendars ! Acaci × my.usca.edu Chapter 5 Homework (part 1) McGraw-Hill Connect l brorxehegg Study!Guided × ezto.mheducation.com/hm.tpx DCQ Search ost Visited Getting Started My USC Aiken-Black.. The True Story of Poc connect. BADM 363 Business Finance: Fall 2017 (ALL FINANCE hapter 5 Homework (part 1) nstructionst help Question 13 (of 13) Save& Ext Subm 1000 points You did not receive full credt for this question in a preious atempt Problem 5-52 Calculating Present Value of a Perpetuity[L1] Given an interest rate of 6.7 percent per year what is the value at Year 9 of a perpetual stream of $3,450 payments that begin at Year 17? (Do not round intermediate calculations and round your answer to 2 decima places, e.g., 32.16.) Present value $1 [ References eBook & Resources :Annuities Worksheet Difficúlty 2 Intermediate Problem 5-52 Calculating Present Value of a Perpetuity [LO 1] Learning Obedier pson Deermne·h, Lure and present value of investments with mültiple cash flows 1035 AM 11/22/2017

Explanation / Answer

Value at Year 9 ,taking Year 1 as 0 , of an annuity of 3450, for 8 yrs./periods at 6.7% p.a.= Using PV of annuity formula, 3450*(1-1.067^-8)/0.067= 20842.65 (ANSWER)

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