Fin 534 Week 4 Hw Set 2

FIN 534 WEEK 4 HW SET 2

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FIN 534 Week 4 HW SET 2,

Answer the following questions on a separate document. Explain how you reached the answer or show your work if a mathematical calculation is needed, or both. This homework assignment is worth edging points. Use the following information for Questions 1 through 5: Assume that you are nearing graduation and have applied for a job with a local bank. The bank’s evaluation process requires you to take an examination that covers several financial analysis techniques. The first section of the test asks you to address these discounted cash flow analysis problems:

1. What is the present value of the following uneven cash flow stream -$50, $100, $75, and $50 at the end of Years 0 through 3? The appropriate interest rate is 10%, compounded annually.

year Cash flows pvif@10% Pave of cash flows

$

0 -50 1 -50

1 100 0.9091 90.91

2 75 0.8264 61.98

3 50 0.7513 37.565

Total 140.455

2. We sometimes need to find out how long it will take a sum of money (or something else, such as earnings, population, or prices) to grow to some specified amount. For example, if a company’s sales are growing at a rate of 20% per year, how long will it take sales to double?

Answer the following questions on a separate document. Explain how you reached the answer or show your work if a mathematical calculation is needed, or both. This homework assignment is worth edging points. Use the following information for Questions 1 through 5: Assume that you are nearing graduation and have applied for a job with a local bank. The bank’s evaluation process requires you to take an examination that covers several financial analysis techniques. The first section of the test asks you to address these discounted cash flow analysis problems:

1. What is the present value of the following uneven cash flow...