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annual cash flows

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Question

A project that costs $5,350 to install will provide annual cash flows of $1,800 for each of the next 6

years.

Calculate the NPV if the discount rate is 11%. (Do not round intermediate calculations. Round your answer to 2 decimal places.)
  NPV$  
Is this project worth pursuing?
 
YesNo
How high can the discount rate be before you would reject the project? (Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places.)
  Discount rate %  
 
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What is the present value of $100 to be deposited today

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Question

What is the present value of $100 to be deposited today into an account paying 8%, compounded semiannually for 2

years

 
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What is the present value of

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Question

17)What is the present value of:Use Appendix B as an approximate answer, but calculate your final answer using the formula and financial calculator methods.  a.$8,000 in 13 years at 8 percent? (Do not round intermediate calculations. Round your final answer to 2 decimal places.)    Present value$     b.$18,000 in 7 years at 9 percent? (Do not round intermediate calculations. Round your final answer to 2 decimal places.)    Present value$     c.$27,800 in 18 years at 10 percent? (Do not round intermediate calculations. Round your final answer to 2 decimal places.)    Present value$  

 
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interest rate

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Question

16)The treasurer for Pittsburgh Iron Works wishes to use financial futures to hedge her interest rate

exposure. She will sell five Treasury futures contracts at $137,000 per contract. It is July and the contracts must be closed out in December of this year. Long-term interest rates are currently 10.30 percent. If they increase to 12.50 percent, assume the value of the contracts will go down by 10 percent. Also if interest rates do increase by 2.2 percent, assume the firm will have additional interest expense on its business loans and other commitments of $73,000. This expense, of course, will be separate from the futures contracts.

a.What will be the profit or loss on the futures contract if interest rates go to 12.50 percent by December when the contract is closed out? (Input the amount as a positive value.)
  (Click to select)ProfitLoss on futures contracts$  
b-1.After considering the hedging, what is the net cost to the firm of the increased interest expense of $73,000?
  Net cost
 
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