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Economics

Calculate the present value of each of the following future payments.

a) What is the present value of receiving $200 one year from now when the prevailing rate of interest is 8 percent?

b) What is the present value of $200 to be paid to you at the end of two years, if the market interest rate is 5 percent?

c) If you are to receive a payment of $200 at the end of the first year and a payment of $250 at the end of the second year and the market interest rate is 5 percent, what is the present value of this income stream?

d) If the discount rate is 5 percent, the present value of annual $100,000, what is the payment in perpetuity?

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Business Economics, Economics

Category:- Business Economics
Reference No.:- M91928320

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