Click to see additional instructions You own real estate the market value of which t years from now is V(t) = 10000et to the power 0.5 Assuming that the interest rate for the foreseeable future will remain at 7 percent, find the optimal selling time. Note: Please answer using whole numbers. Answer: The optimal selling time is approximately years from now. Note: See Textbook, Ch. 5
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- Determine the present value, P, you must invest to have the future value, A, at simple interest rate r after time t. Round answer to the nearest dollar. A = $2140 r = 7% t = 1 year $2000 $2070 $2007 $2035Question: From #1, assume you buy now and sell in 10 years, what is your Present Value (PV)?EX.M.106 Use the future value tables to answer the following questions. (Click here to access the PV and FV tables to use with this problem.) Required: Round your answers to the nearest dollar. 1. What is the value on January 1, 2027, of $75,000 deposited on January 1, 2020, which accumulates interest at 14% annually? $___________ 2. What is the value on January 1, 2025, of $15,000 deposited on July 1, 2020, which accumulates interest at 16% compounded quarterly? $__________ 3. How much interest will accumulate on an investment of $10,000 left on deposit for 7 years at 8% compounded annually? $__________
- Suppose initially that two assets, A and B, will each make a single guaranteed payment of $400 in 1 year. But asset A has a current price of $280 while asset B has a current price of $320. Instructions: Round your answers to 2 decimal places. a. What are the rates of return of assets A and B at their current prices? Return on assetA =| |percent Return on asset B = percent Given these rates of return, which asset should investors buy and which asset should they sell? Buy asset (Click to solect) v and sell asset (Click to select) b. Assume that arbitrage continues until A and B have the same expected rate of return. When arbitrage ends, will A and B have the same price? (Click to select) Next, consider another pair of assets, C and D. Asset C will make a single payment of $600 in 1 year, while D will make a single payment of $800 in 1 year. Assume that the current price of C is $440 and that the current price of D is $680. c. What are the rates of return of assets C and D at their…Determine the present value P you must invest to have the future value A at simple interest rate r after time t. A = $19,000, r = 11.5%, t = 4 years The present value that must be invested to get $19,000 after 4 years at an interest rate of 11.5% is $. (Round up to the nearest cent.)Suppose the interest rate is 3.6% b. Having $650 in one year is equivalent to having what amount today? c. Which would you prefer, $650 today or $650 in one year? Does your answer depend on when you need the money? Why or why not? **round to the nearest cent**
- An investor is considering the purchase of a financial instrument that promises to make the following payments: Promised Payment by Issuer $100 $100 $100 $100 $1,100 Years from Now 1 2 3 4 5 This financial instrument is selling for $1,243.83. Assume that the investor wants a 6.25% annual interest rate on this investment. Should the investor purchase this investment? OA. Yes, the financial instrument is attractive O B. No, the financial instrument is unattractive. C. Can't be answered. More information is needed to answer the question D. Indifferent.A3ai Use the present value and future value formulas to solve the following problems. Confirm your answers with your financial calculator. Show both methods of calculation in your answers. When performing your calculations, keep as many decimal places as you can for intermediate answers, but round your final answers to two decimal places. (10 marks total) If you invest $1000 today at 3% annual interest rate, how much money would you have in one year’s time?Assume that you must estimate what the future value will be two years from today using the future value of 1 table. (PV of $1, EV of $1. PVA of $1, and FVA of $1) Which interest rate column and number-of-periods row do you use when working with the following rates? (Round percentage answers to 2 decimal places.) Answer is complete but not entirely correct. Number of Periods 1. 12% annual rate, compounded annually 2.8% annual rate, compounded semiannually 3. 12% annual rate, compounded quarterly 4. 12% annual rate, compounded monthly Interest Rate 12.00 2.00 3.00 1.00 % % % % 2 80 24
- Site ana sayfası Takvim Nişanlar Tüm dersler Course dashboard The formula for finding the present value of an amount M that will be received one year from now, when the interest rate is R, 1s Lutfen birnni seçin. O a M/(1+R) ObMx(1+ R/100) O cM/R. OdMx(1+ R) SONRAKİ SAYFA YFA deki ders materyalleri Creative Commons açık lisansları ile lisanslanmıştır.Determine the present value, P, you must invest to have the future value, A, at simple interest rate r after time t. Round answer to the nearest dollar. A=$5,000, r=8.2%, t=5 yearsDetermine the present value P you must invest to have the future value A at simple interest rate r after time t. A = $14,000, r = 7.5%, t = 8 years