American boy‚ was sentenced to series of canings and jail time for the act of vandalism. The unusual punishment raised several controversial arguments in the US and put the Singaporean justice system in the spotlight. Harsh and oppressive punishments such as caning should not exist in the justice system of any country because s it considered torture and establishes fear in society. In the article “Time to Assess American Values”‚ by the New York Times‚ caning is refuted gracefully but on the article “Rough
Premium Criminal justice Singapore Punishment
Outline your sources and uses of funds for date 0 and date 1. (g) Will you loan your farm for a period for 23‚100 bushels of corn? Why? If you have no corn at date 0‚ and you decide to loan the farm‚ what will be your consumption plan? 1 2. Your life span is two periods. You are endowed with $500 today. You √have a production technology which can transform an investment of $I today into $40 I next year. Also‚ you can borrow at 33 31 % per annum and lend at 25% per annum. (a)
Premium Time value of money Interest Rate of return
Semiannually Twice per year Quarterly Four times per year Monthly Twelve times per year Weekly Fifty two times per year Daily 365 (360 by banks) per year COMPOUND INTEREST FORMULA The amount A after t years due to a principal P invested at an annual interest rate r compounded n times per year is r A P 1 n nt A is commonly referred to as the accumulated value or future value of the account. P is called the present value. COMPOUND INTEREST Example: Investing $1000
Free Compound interest Time value of money
………5 Present Value…………………………………………………………………………...5 Analysis Illustrations……………………………………………………………………6 Conclusion………………………………………………………………………………7 References……………………………………………………………………………....9 The purchase of an automobile is a very important financial transaction one can make. Not only is a car an expensive purchase‚ it also comes with a cost of maintenance‚ repair‚ and once it is driven off the dealers lot‚ the vehicle becomes an investment that readily depreciates in value. Most buyer looking
Premium Net present value Leasing Finance lease
SEMESTER A 2015 CHAPTER 5 – EXERCISES P5–2 Future value calculation Without referring to the preprogrammed function on your financial calculator‚ use the basic formula for future value along with the given interest rate‚ r‚ and the number of periods‚ n‚ to calculate the future value of $1 in each of the cases shown in the following table. P5–4 Future values for each of the cases shown in the following table‚ calculate the future value of the single cash flow deposited today at the end of the
Premium Compound interest Time value of money
m& Practice Questions: Time Value of Money (TVM) & Its Applications in Investments 1. Jose now has $500. How much would he have after 6 years if he leaves it invested at 5.5% with annual compounding? a. $591.09 b. $622.20 c. $654.95 d. $689.42 e. $723.89 N 6 I/YR 5.5% PV $500 PMT $0 FV $689.42 2. How much would $5‚000 due in 25 years be worth today if the discount rate were 5.5%? a. $1‚067.95 b. $1‚124.16 c. $1‚183.33 d. $1‚245.61 e. $1‚311.17
Premium Money Time value of money Finance
CHAPTER 2 How to Calculate Present Values Answers to Problem Sets 1. If the discount factor is .507‚ then .507*1.126 = $1 2. 125/139 = .899 3. PV = 374/(1.09)9 = 172.20 4. PV = 432/1.15 + 137/(1.152) + 797/(1.153) = 376 + 104 + 524 = $1‚003 5. FV = 100*1.158 = $305.90 6. NPV = -1‚548 + 138/.09 = -14.67 (cost today plus the present value of the perpetuity) 7. PV = 4/(.14-.04) = $40 8. a. PV = 1/.10 = $10 b. Since the perpetuity
Premium Time value of money Net present value Compound interest
CHAPTER 2 How to Calculate Present Values Answers to Problem Sets 1. If the discount factor is .507‚ then .507*1.126 = $1 2. 125/139 = .899 3. PV = 374/(1.09)9 = 172.20 4. PV = 432/1.15 + 137/(1.152) + 797/(1.153) = 376 + 104 + 524 = $1‚003 5. FV = 100*1.158 = $305.90 6. NPV = -1‚548 + 138/.09 = -14.67 (cost today plus the present value of the perpetuity) 7. PV = 4/(.14-.04) = $40 8. a. PV = 1/.10 = $10 b. Since the perpetuity will be worth $10 in year
Premium Time value of money
Gate Harlow Essex CM20 2JE England and Associated Companies throughout the world Visit us on the World Wide Web at: www.pearsoned.co.uk Previous editions published under the Prentice-Hall imprint Twelfth edition published under the Financial Times Prentice Hall imprint 2005 © 2001‚ 1998 by Prentice-Hall‚ Inc. © Pearson Education Limited 2005 The rights of James C. Van Horne and John M. Wachowicz JR. to be identified as authors of this work have been asserted by them in accordance with the
Premium Time value of money Financial statements Pearson PLC
if debt carries no market risk 1.5 Cost of Debt rD = rf + Credit Spread 1.6 Cost of Equity CAPM: rE = rf + βE(rm-rf) 1.7 Cost of Capital (WACC) • Capital structure components should be measured on a market value basis‚ not a book value or historic basis • Use a target capital structure rather than the current or historic capital structure • T always means the incremental tax-rate • Debt includes long-term debt‚ financing leases‚ short-term debt‚ operating
Premium Net present value Finance Discounted cash flow