公司理财(罗斯)4(英文).ppt

* If you can do this on the first try, you’re an “A” student. * If you can do this on the first try, you’re an “A” student. 4-* Is called an annuity factor, it is expressed as ArT , it stands for the present value of $1 a year for T years at an interest rate of r. 4-* Annuity Intuition An annuity is valued as the difference between two perpetuities: one perpetuity that starts at time 1 less a perpetuity that starts at time T + 1 0 1 C 2 C 3 C T C 4-* Annuity: Example If you can afford a $400 monthly car payment, how much car can you afford if interest rates are 7% on 36-month loans? 0 1 $400 2 $400 3 $400 36 $400 4-* Trick1:A Delayed Annuity What is the present value of a four-year annuity of $100 per year that makes its first payment two years from today if the discount rate is 9%? ? 0 1 2 3 4 5 $100 $100 $100 $100 $327.97 $297.22 4-* Trick 2: Annuity in Advance An annuity with an immediate initial payment is called an “annuity in advance” 0 1 $50000 2 $50000 3 $50000 20 $50000 4-* Trick 3: The Infrequency Annuity An annuity with payments occurring less frequently than once a year For example on p82, 0 1 2 $450 4 $450 20 $450 4-* Trick 4: Equating present value of two annuities 0 1 deposit 2 deposit 3 deposit 18 tuition For example on 83, 21 17 4-* Growing Annuity A growing stream of cash flows with a fixed maturity. The formula for the present value of a growing annuity: 0 1 C 2 C×(1+g) 3 C ×(1+g)2 T C×(1+g)T-1 4-* Growing Annuity A defined-benefit retirement plan offers to pay $20,000 per year for 40 years and increase the annual payment by three-percent each year. What is the present value at retirement if the discount rate is 10 percent? 0 1 $20,000 2 $20,000×(1.03) 40 $20,000×(1.03)39 4-* PV of a delayed growing annuity Your firm is about to make its initial public offering of stock and your job is to estimate the correct offering price. Forecast dividend