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For problems 1 – 5, use a discount rate of 10%.
1. What would be the value of an asset that returns a cash flow of $1000 one year from
now?
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- Erin's investment account changed by -17% of its value. After this change, the account's value was $13,790. What was its value before this change?9. Duration is an accurate measure of the relationship between percentage changes in a bondprice and changes in its yield.What will be the total investment cost of shares? Show appropriate calculations.
- doc=%7BAD92995B-8389-4985-A3B9-58AS er 12 - Saved Search Review View Help Open in Desktop App O Editing v A^ B IU ev Av A ミv王 三< Assignment 7 critical analysis Chapter 12 pages 251-252. Answer questions numbered 2, 3, 6, 10 and 12. They will be worth 20 points each. Upload your answers on this website below. This Assignment is due Thursday at midnight. The same time that assignment 6 is due. My grader will grade both assignments Friday. You have exam 3 early next week. 2. What is the crowding- out effect? How does it modify the implications of the basic Keynesian model with regard to fiscal policy? How does the new classical theory of fiscal policy differ from the crowding-out model? ...Joe deposits his 2200$ paycheck into his checking account at Local Bank. The bank's assets will then increase by $ enter your response here. (Round your response to the nearest whole number.)3. Which of the following must be included in an organization’s statement of accounting profits for the statement to be of use?a. the estimated amount the organization could have earned pursuing other optionsb. the extent to which technological improvements increased productivityc. the percentages planned for reinvestment or distribution to investorsd. the period in which the profit was earned, such as a year or a quarter
- David runs his own business. He received an offer from a company for $50,000 per year. If he sells his business, he can get an amount of $100,000. Assume the annual interest rate is 5%. David is confused to run his own business or join the company. David annual revenue from his business is enough to cover all explicit costs and has $60,000 left over. There are no additional implicit costs. Calculate David’s accounting and economic profit.a) Suppose you put $350 into a bank account today. Interest is paid annually and the annual interest rate is 6 percent. What is the future value of the $350 after 4 years? b) Suppose you are deciding whether to buy a particular bond from your local municipality. If you buy the bond and hold it for 4 years, then at that time you will receive a payment of $10,000. Assume the interest rateis6percent. Underwhatcircumstanceswillyoubuythebond?Meaninguptowhatpriceareyou willing to pay.It refers to an annual decrease in value of physical properties with passage of time and use O A. Annuity O B. Depreciation O C. Stock O D. Bond
- 2 A firm is planning to pay a dividend of $1.50 in a year. The growth rate of dividend is expected to be 4% a year and the required rate of retum is 99%. What is the value of this stock? Round to the nearest cent. Do not include the dollar sign in your answer. (i.e. If your answer were $123, then type 1.23 without a $ sign)Assume that A&K Sound System needs borrow money on the bond market. Whywould an increase in interest rates affect the decision whether to build the studio?You have decided to invest in an open-end mutual fund. You are currently looking at a fund-Washington Premier Fund-in your newspaper. The fund is quoted as: Name NAV Net Chg YTD %RET 36.25 0.15 6.95 Assume that today's opening price of Washington Premier Fund equals yesterday's closing price. If you wanted to make your investment first thing this morning, then you should expect to pay for each share of since it Yesterday, each share of sold for $35.95 $43.50 $36.25 $34.44 $0.15 less $0.15 more $6.95 less $6.95 more If you had $8,000 available to invest, you could purchase than it did the day before, and offers a return of 294 368 assesses a 0.15% fee 276 shares of. is a no-load fund charges a 6.95% fee 221 Your evaluation of the Washington Premier Fund is made easier by the fact that: your investment choices are limited. mutual funds are careful to explicitly state their investment objectives. a mutual fund broker will select a customized mix for you. 0.15% 36.25% 6.95% for the year.