13. An industrial engineer invests $100,000.00 now, and in three years he adds $3,000.00 to the investment. He is able to withdraw $5,000.00 the first year increasing by $1,000.00 each year for 10 years. He also will be withdrawing $50,000.00 in five years and $20,000.00 in 10 years. Using net present worth analysis, determine the rate of return on the investment. Using equivalent uniform annual worth analysis, determine the rate of return.
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- Assume that your father is now 50 years old and plans to retire after 10 years from now. He is expected to live for another 25 years after retirement. He wants a fixed retirement income of Rs. 5,00,000 per annum. His retirement income will begin the day he retires, 10 years from today, and then he will get 24 additional payments annually. Your father has current savings of Rs. 10,00,000 and he expects to earn a return on his savings @ 10% p.a., annually compounding. How much (to the nearest of rupee) must your father save during each of next 10 years to meet his retirement goal?You are planning to invest $4,000 in an account earning 8% per year for retirement. a. If you put the $4,000 in an account at age 23, and withdraw it 50 years later, how much will you have? b. If you wait 10 years before making the deposit, so that it stays in the account for only 40 years, how much will you have at the end? a. If you put the $4,000 in an account at age 23, and withdraw it 50 years later, how much will you have? In 50 years you would have $750424. (Round to the nearest cent.)What is the amount you would need to invest today or order to have $30,000 in 20 years and your investment has a 5% rate of return that is compounded annually? Round your answer to the nearest cent.
- Suppose an initial investment of $100 will remain $50/year fo r three years (assume the $50 is received each year at the end of the year). Is this a profitable investment?Suppose that you plan to retire at 65. You invest $8,000 per year on your birthday for 10 years starting on your 25th and ending on your 34th birthday. Since you are young, you take more risks with your investments, and earn a rate of return of 12%. Then, you have children and decide to put all your retirement savings into investing in a college fund for them. You leave all accumulated funds in the retirement account, and it earns 6% per year, reflecting an (unwise) rise in caution during middle age. How much money will you have to retire on at 65 (31 years after you stop contributing)George wants to retire at 65 with $1,000,000 in savings. He plans to deposit a lump sum on his birthday each year. How much will he need to invest each year if he starts saving at 25? 35? 45? Assume an interest rate of 6%
- DRAW THE CASH FLOW DIAGRAM Ashley purchased a common stock worth $5,000 every year (starting in year 1) for a period of 10 years. At the end of the 10th year, she sold all her stocks to a buyer for $80,000. Find the rate of return received on the investment.Lorenz curves also can be used to provide a relative measure of the distribution of the total assets of a country. Using data in a report by the economic committee of a certain country, an economist produced the following Lorenz curves for the distribution of total assets in the country in 1963 and 1983, shown below. f(x) = x10 Lorenz curve for 1963 g(x) = x13 Lorenz curve for 1983 Find the Gini index of income concentration for each Lorenz curve and interpret the results. .... What is the Gini index for 1963? (Round to three decimal places as needed.) What is the Gini index for 1983? (Round to three decimal places as needed.) Interpret your results. O A. Total assets were more equally distributed in 1963 O B. Total assets were more equally distributed in 1983 O c. Total assets were distributed the same in 1963 as in 1983.4:09 Assignment 2-2022.pdf 4. Construct a cash flow diagram to find the present worth in year 0 at an interest rate of 12% per year for the following situation. Year Cash Flow, $ 0 5. Construct a cash flow diagram that represents the amount of money that will be accumulated in 20 years from an investment of $30,000 now at an interest rate of 10% per year. 6. for the cash flow diagram shown, what are the present and the future worth in year 4? i = 7%/semiannual period 1 2 470 3 420 2 4 370 0 1-5 5 320 6 3 270 7 Y 220 4 -15,000 +8,500 8 200 :!!! 5G Years Semiannual periods 7. Construct the cash flow diagram for A mechanical device will cost $20,000 when purchased. Maintenance will cost $1000 per year. The device will generate revenues of $5000 per year for 5 years. The salvage value is $7000. 8. Each year Exxon-Mobil expends large amounts of funds for mechanical safety features throughout its worldwide operations. Carla Ramos, a lead engineer for Mexico and Central American operations,…
- Consider the following bond purchased at $800 in 2018. F=1000; C=100; N=5; P=800 If the investor sold the bond in 2019 without holding till maturity did he/she make a profit or a loss? What is the rate of return in 2019?The common stock of XYZ paid $1.32 in dividends last year. Dividends are expected to grow at an 8% annual rate for an indefinite number of years. If the require rate of return is 10.5%, should you make this investment? Why?Economics A small company purchased now for $23,000 will lose $1,200 each year the first four years. An additional $8,000 invested in the company during the fourth year will result in a profit of $5,500 each year from the fifth year through the fifteenth year. At the end of 15 years, the company can be sold for $33,000. The MARR = 12% per year. a. Draw a cash-flow diagram. b. Calculate the FW? %3D