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- $1000 accummualtes to $1500 in 5 years time and the rate of inflation is 3% p.a. What is the annual effective real rate of return? Question 6Select one:Select one: A. 5.29% B. 6.38% C. 11.70% D. 2.25%If you are promised $50,000 six years from now, the present worth at a real rate of return of 4% per year and an inflation rate of 3% per year is closest to:a. $27,600b. $29,800c. $33,100d. $37,200Suppose you have $1,000,000 today and starting a year from now you intend to spend this money over the next 30 years. Assume the nominal rate of interest is 9.2%, inflation rate of 5% and the real rate of interest is 4%. How much can you spend annually in real dollar terms over the next 20 years to ensure constant spending in real terms? A. $40,000.00 B. $57,830.10 C. $64,011.96 D. $73,581.75
- 2 bok nt int What is the value today of $4,300 per year, at a discount rate of 10 percent, if the first payment is received 6 years from today and the last payment is received 20 years from today? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) Value today10. . You start to save for a major purchase. You can invest GH¢320 every three months for 3 years and 9 months. You are able to earn 5.34% compounded semi- annually. What is the amount of interest that you earn during the entire term? * c. GH¢472.26 a. GH¢468.54 d. GH¢2506.00 b. GH¢5272.26 11. How much interest will be earned on GH¢5,000 deposited today that will earn a 4% compounded quarterly and will be invested for 6 years? * a. GH¢1,326.60 b. GH¢6,326.60 d. GH¢1,348.67 c. GH¢6,348.675. Solve the following two independent scenarios: A. How much must be invested now to receive $30,000 for 10 years if the first $30,000 is received one year from now and the rate is 8%? Future Value PV FV Tables Factor Present Value ? ? ? PLEASE NOTE: All FV Factors will be rounded to three decimal places (i.e. 1.234). All dollar amounts will be with "$" and commas as needed and rounded to whole dollars (i.e. $12,345). Using the appropriate EXCEL spreadsheet, the answer = ? PLEASE NOTE: The dollar amount will be with "$" and commas as needed and rounded to two decimal places (i.e. $12,345.67). B. Project A costs $5,000 and will generate annual after-tax net cash inflows of $1,800 for five years. What is the NPV using 8% as the discount rate? Future Value PV FV Tables Factor Net Present Value ? ? ? PLEASE NOTE: All FV Factors will be rounded to three decimal places (i.e. 1.234). All dollar amounts will be with "$" and commas as needed and rounded to whole dollars (i.e.…
- If you invest 5000 dollars today at a compound interest rate of 9 percent, what will be its future value after 30 years? (CVIF9,30 = 13.268)Select one:a. 66,340 dollars. b. 65,000 dollars.c. 18,500 dollars.d. 60,000 dollars.e. 1,350,000 dollarsQ4. You plan to save the following amounts: 3,095 today 7, 566 per year for the next 10 years 8,390 per year for the following 1 years 10, 650 per year for the following 3 years 17,021 per year for the final 9 years Assuming you earn a 10% rate of return during the entire period, how much will you have at the END of the time horizon? Round answer to the nearest dollar.Revenue from a project is expected to be $7000 per year in real terms (i.e. an identical project would earn $7000 in revenue today). If the expected inflation rate is 2.4%, what is the nominal value of the annual revenue (the actual number of dollars received) 8 years from now? Question 4Answer a. $8462 b. $8666 c. $8264 d. $8070
- You want to have $3.5 million in real dollars in an account when you retire in 50 years. The nominal return on your investment is 8 percent and the inflation rate is 3.5 percent. What real amount must you deposit each year to achieve your goal? A. $20,569.90 B. $6,100.00 C. $21,598.40 D. $21,392.70 E. $19,541.41ESS What would be the purchasing power (in today's money) of $1,000 (actual $) in 10 years' time from now, assuming an average inflation rate of 5%? (In other words, convert the future (End of year 10) $1,000 actual $ into constant $ (at end of year 10))Assume you plan to save to take a tour of Europe in 3 years. The current price of the tour, all expenses included, is $6,000. What is the expected purchase price in 3 years if the expected rate of inflation is 2.5% per year? Round the expected price up to the nearest one hundred. 1. a. The expected price of the tour in 3 years is S b. How much must be deposited today in an account that eams 4% annual interest after taxes, compounded quarterly? must be deposited today. How much must be saved each quarter in an account that eams 4% annual interest с. after taxes, compounded quarterly? must be deposited each quarter.
