This topic contains a solution. Click here to go to the answer
« previous next »

Author Question: You have decided to endow the insert your name here Chair in Finance at the State University. How ... (Read 101 times)

Bob-Dole

  • Hero Member
  • *****
  • Posts: 547
on: Jul 10, 2018
You have decided to endow the insert your name here Chair in Finance at the State University.
 
  How much money must you deposit into the endowment account today if the Chair pays 125,000 per year forever (first payment one year from today) and is invested at a rate that pays out 4.50 per year forever
  What will be an ideal response?

Question 2

Given a positive interest rate and a positive cash flow, an ordinary annuity always has a greater future value than an annuity due of the same size and number of cash flows.
 
  Indicate whether the statement is true or false.


Related Topics

Need homework help now?

Ask unlimited questions for free

Ask a Question
Marked as best answer by a Subject Expert

fauacakatahaias

  • Sr. Member
  • ****
  • Posts: 353
Reply #1 on: Jul 10, 2018
Answer to Question 1

Answer: PV = = = 2,777,777.78.

Answer to Question 2

Answer: FALSE
Explanation: The annuity due is always greater.


Bob-Dole

  • Hero Member
  • *****
  • Posts: 547
Reply #2 on: Jul 10, 2018
Thank you :)


fauacakatahaias

  • Sr. Member
  • ****
  • Posts: 353
Reply #3 on: Jul 10, 2018
Happy to help you


« previous next »
 

Did you know?

Vampire bats have a natural anticoagulant in their saliva that permits continuous bleeding after they painlessly open a wound with their incisors. This capillary blood does not cause any significant blood loss to their victims.

Did you know?

The human body's pharmacokinetics are quite varied. Our hair holds onto drugs longer than our urine, blood, or saliva. For example, alcohol can be detected in the hair for up to 90 days after it was consumed. The same is true for marijuana, cocaine, ecstasy, heroin, methamphetamine, and nicotine.

Did you know?

Hip fractures are the most serious consequences of osteoporosis. The incidence of hip fractures increases with each decade among patients in their 60s to patients in their 90s for both women and men of all populations. Men and women older than 80 years of age show the highest incidence of hip fractures.

Did you know?

All adults should have their cholesterol levels checked once every 5 years. During 2009–2010, 69.4% of Americans age 20 and older reported having their cholesterol checked within the last five years.

Did you know?

There are actually 60 minerals, 16 vitamins, 12 essential amino acids, and three essential fatty acids that your body needs every day.

Localization of a Peptide The peptide is revealed by means of immunocytochemistry. The photomicrogra Localization of a Peptide The peptide is revealed by means of immunocytochemistry. The photomicrogra
With the rocker arms contacting the base circle of the cam, insert a feeler gauge of the specified ... With the rocker arms contacting the base circle of the cam, insert a feeler gauge of the specified ...
With the rocker arms contacting the base circle of the cam, insert a feeler gauge of the specified ... With the rocker arms contacting the base circle of the cam, insert a feeler gauge of the specified ...
Fixed bed state (i) and complete fluidization (ii) Fixed bed state (i) and complete fluidization (ii)
Percentage of Americans Living in Communities with a Fluoridated Water Supply, by State. 2012 Percentage of Americans Living in Communities with a Fluoridated Water Supply, by State. 2012
Principles of Managerial Finance, 14th Edition Principles of Managerial Finance, 14th Edition
Video: Ventilation - phases and driving forces

For a complete list of videos, visit our video library