GAIA2 M 14

A

What is the value of a five-year income stream growing at 3% per year if the first-year income is $12,000 and the discount rate is 9%? $49,310 $50,789 $48,415 $63,708

A

What is the value of a five-year, $100,000 level income stream if the discount rate is 9%? $388,965 $453,958 $710,782 $439,261

C

What is the value of an $8,000 per year level perpetual income stream at 6%? $110,119 $58,880 $133,333 $75,000

B

What is the value of an annual income stream of $10,000 for five years with a reversion of $100,000 at the end of five years, if the discount rate is 10%? $110,000 $100,000 $125,000 $10,000

A

What is the value of an investment that pays $8,000 per year, level for 10 years, and has a reversion of $133,333 if the discount rate is 6%? $133,333 $104,880 $213,333 $113,333

B

What is the value of the following income stream at a 14% discount rate? Year 1: $10,000 Year 2: $12,000 Year 3: $13,000 Year 4: $15,000 Year 5: $18,000 $47,109 $45,010 $42,456 $49,451

D

What is the value of $75,000 per year for 10 years with a reversion of $833,333 and a discount rate of 9%? $1,000,000 $446,123 $785,341 $833,333

C

What is the value of $75,000 per year for 10 years with a reversion of $833,333 and a discount rate of 9%? $785,341 $446,123 $833,333 $1,000,000

A

What is the value of $75,000 perpetual net income per year if the appropriate discount rate is 9%? $833,333 $675,000 cannot be solved without number of years dura"on $415,111

D

What is the value of $9,000 perpetual net income per year if the appropriate discount rate is 10%? cannot be solved without number of years $900,000 $900 $90,000

A

What is the value of a $15,000 per year level income stream for 25 years, if the appropriate discount rate is 12%? $117,647 $122,720 $112,041 $125,998

A

What is the value of a $250,000 per year level income stream for 400 years, if the appropriate discount rate is 10%? $2,500,000 $2,444,762 $2,250,998 $1,282,720

A

What is the value of a $5,000 per year level income stream for eight years at 10%? $26,675 $50,000 $40,000 $33,550

D

What is the value of a $5,000 per year level income stream for eight years at 10%? $50,000 $40,000 $33,550 $26,675

A

What is the value of a perpetual income stream of $10,000 at a 8% discount rate? $125,000 $100,000 $1,000,000 $800,000

D

What is the value of a perpetual income stream of $100,000 at a 10% discount rate? $800,000 $100,000 $125,000 $1,000,000

C

What is the value of a property with a $100,000 level income stream and an anticipated 18% increase in value over five years if the discount rate is 9%? $388,965 $1,111,111 $1,668,798 $832,801

D

What is the value of the following income stream at a 14% discount rate? Year 1: $10,000 Year 2: -$12,000 Year 3: $13,000 Year 4: -$15,000 Year 5: $18,000 $2,456 $5,010 $9,451 $8,780

A

What is the value of the following income stream at an 8% discount rate? Year 1: $35,000 Year 2: $10,000 Year 3: $25,000 Year 4: $45,000 Year 5: $50,000 $127,932 $149,451 $147,109 $142,456

C

What is the value of the following income stream if the discount rate is 8%? Year 1: $12,000 Year 2: $12,500 Year 3: $11,500 Year 4: $13,000 Year 5: $11,000 $27,838 $60,000 $47,999 $51,838

B

Which of the following are the two types of perpetuities? classic and universal classic and modern modern and historic universal and perpetual

C

What is the value of a property with a seven-year income stream starting at $150,000 if it grows at a compound rate of 4% per year, the reversion is $1,000,000, and the discount rate is 11%? $1,218,577 $2,184,744 $1,266,309 $1,784,651

C

What is the value of a property with a five-year, $100,000 level income stream and a $2,000,000 reversion if the discount rate is 9%? $439,261 $453,958 $1,688,828 $388,965

A

What is the value of a seven-year income stream starting at $150,000 if it grows at a compound rate of 4% per year and the discount rate is 11%? $784,651 $1,184,744 $870,303 $808,393

D

What is the value of $7,000 perpetual net income per year if the appropriate discount rate is 10%? $700,000 cannot be solved without number of years $700 $70,000

A

What are the three general categories of projected income stream patterns? level, compound rate of change, other level, declining, increasing irregular, level, perpetuity level, straight line, perpetuity

C

What is Year 6 income if Year 1 is $100,000 and income is declining at a compound annual rate of 2% per year? $108,243 $110,408 $90,392 $92,237

A

What is the expected reversion for property with a present value of $1,000,000 and level income of minus $10,000, if the required yield is 9% over a 10-year holding period? $2,519,293 $2,936,938 $2,428,571 $2,000,000

C

What is the expected reversion for property with a present value of $200,000 and level income of $20,000, if the required yield is 14% over a five-year holding period? $1,000,000 $2,000,000 $252,880 $1,428,571

B

What is the level income equivalent for the following cash flows if the discount rate is 5%? Year 1: $20,000 Year 2: $23,000 Year 3: $25,000 Year 4: $21,000 Year 5: $25,000 $19,674.03 $23,000.00 $22,721.02 $22,800.00

A

What is the level income equivalent for the following cash flows if the discount rate is 7%? Year 1: $50,000 Year 2: $60,000 Year 3: $50,000 Year 4: $55,000 $53,704.78 $52,500.000 $45,477.36 $53,750.00

D

What is the level income equivalent for the following cash flows if the discount rate is 7.5%? Year 1: $250,000 Year 2: $270,000 Year 3: $300,000 Year 4: $311,000 Year 5: $320,000 $290,200 $300,000 $250,000 $287,567

A

What is the level income equivalent for the following cash flows if the discount rate is 9%? Year 1: $100,000 Year 2: $120,000 Year 3: $100,000 Year 4: $111,000 $107,601 $87,149 $107,750 $105,500

B

What is the level income equivalent of $150,000 Year 1 income declining at 6% per year for five years if the appropriate discount rate is 8%? $536,268.49 $134,311.90 $150,000.00 $669,196.19

D

What is the level income equivalent of $30,000 Year 1 income declining at 5% per year for five years if the appropriate discount rate is 8%? $27,186 $131,384 $109,241 $27,360

B

What is the level income equivalent of $60,000 Year 1 income declining at 5% per year for five years if the appropriate discount rate is 7%? $270,086.65 $54,668.70 $60,000.00 $224,152.44

A

What is the present value of $75,000 per year of level net income for eight years at a discount rate of 9%? $415,111 $827,135 This reflects solving for future value instead of present value. $54,244 $468,516

C

What is the present value of a five-year income stream growing at a compound annual rate of 4% per year if the first-year income is $120,000 and the appropriate discount rate is 9%? $466,758 $511,514 $502,222 $1,333,333

C

What is the present worth of the following cash flows at a 9% yield rate? Year 1: $100,000 Year 2: $120,000 Year 3: $100,000 Year 4: $111,000 $431,000 $379,972 $348,598 $1,111,111

C

What is the value of $5,000 perpetual net income per year if the appropriate discount rate is 10%? $41,111 cannot be solved without number of years duration $50,000 $65,000

D

Which of the following is the primary difference between modern and classic perpetuities? Modern assumes income and value changing at the same compound rate. Classic assumes income and value changing at the same compound rate. Classic assumes a finite termination but unchanging value. Modern assumes a finite termination but unchanging value.

A

Which of the following is true of a perpetuity? The capitalization rate will equal the yield rate. The income and value change at the same compound annual rate. The capitalization rate will be less than the yield rate. The capitalization rate will be greater than the yield rate.

B

Which of the following statements is most accurate regarding a perpetuity? a level annuity that extends into the future without termina"on a level annuity that extends into the future without termina"on, and a level annuity with a finite dura"on and an unchanging value an income stream that has no end a level annuity with a finite dura"on and an unchanging value