Try Yourself - Question 2 What annual rate is required for an investment to grow by 33% in 5 years if interest compounds 82 times per year? A. 6.12% B. 6.04% C. 5.92% D. 5.87% E. 5.71% First use i = FV PV 1/n - - 1. Then use i annual rate = C
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- Find the IRR for an investment that has an initial outlay of 25,000 and is expected to achieve 30,000 after 7 years. O a. 1.4% Ob. 2.6% O c. 3.1% Od. 4.8% O e. None of the above Next pagej. Find the PV and the FV of an investment that makes the following end-of-year payments. The interest rate is 10%. Payment $100 $300 $500 Year 1 2 3 Round your answers to the nearest cent. PV of investment: $ FV of investment: $Economics Q1) study period is 10 years. MARR=12% A В Capital 11000 16000 13000 18000 investment Annual cost Market value PW (12%) 250 300 400 100 1000 1300 1750 2000 -12090 -17276 ??? -17921 a) PW of alternative C equals b) The rejected alternatives are c) The first comparison in the incremental analysis should be A (?-?) d) Write down the equation of the IRR A (D-B) e) Rank order the alternatives from best to the worst (if any) f) Draw the cash flow diagram for A (C-A)
- D Listen An investment opportunity requires an initial cash outlay of $70,000. Thereafter, it is expect to earn profits of $15,000 per year for 6 years. Calculate the IRR for the investment. Express your answer as a percent rounded to 2 decimal places but don't include the % sign. Your Answer: Answerin 1. Calculate the Annual rate of return. Solving for Rates - Excel HOME INSERT PAGE LAYOUT FORMULAS DATA REVIEW VIEW Calibri, BIU - A- Alignment Number Conditional Format as Cll Formatting Table Styles 国 Paste Cipboard H. 1. D. E. C. 3. What annual rate of return is earned on a $5,000 investment when it grows to $10,750 in six years? (Do not round intermediate calculations and round your final answer to 2 decimal places. Present value Future value Number of periods 0000 2410,750 Complete the following analysis. Do not hard code values in your calculations. 28 of 40 ere to search %23(Compound value solving for r) At what annual rate would the following have to be invested? a. $500 to grow to $983.58 in 10 years b. $280 to grow to $420.20 in 6 years c. $48 to grow to $489.48 in 19 years d. $200 to grow to $268.02 in 6 years Question content area bottom Part 1 a. At what annual rate would $500 have to be invested to grow to $983.58 in 10 years? enter your response here %
- According to the Rule of 72, what must the return on an investment be to double an initial investment of $1,000 in 7 years? Multiple Choice 10.41% 2% 8.63% 10.29% 7.2% Show all steps of calculation and formulas if necessarya. Find the FV of $1,000 invested to earn 8% after 5 years. Round your answer to the nearest cent. b. What is the investment's FV at rates of 0%, 4%, and 30% after 0, 1, 2, 3, 4, and 5 years? Round your answers to the nearest cent. Year 0 1 2 1469.32 4 5 Մ S S S S $ 0% $ $ $ $ $ $ LA Interest Rate 4% ŁA LA 30% Choose the correct graph of future value as a function of time and rate. Note: blue line is for 0%, orange line is for 4%, and grey line is for 30%.Find the internal rate of return for the following investment (yes I want the actual rate). Is it a good idea if MARR=10%? Year 2$ -160,400 75,000 -32,000 55,000 32,500 69,500 1 3 4
- Investment If $5000 is invested for 6 years atinterest rate r (as a decimal), compounded annually, the future value of the investment is given byS = 5000(1 + r) 6dollars.a. Find the future value of this investment for selectedinterest rates by completing the following table. b. Graph this function for 0 <= r <= 0.20.c. Compute the future value if the rate is 10% and20%. How much more money is earned at 20%?Find the NPV: Financial Calculator: Investment that pays $4,880 at the end of each of the next 3 years. Initial cost of $1,220 and a cost at the end of the 2nd year of $6,100. Interest rate is 1.7%. My numbers in the FC are: N: 3 I/Y: 1.7% PV: CPT; Initial Investment cost of -7,320 PMT: 4,880 each year (3x) CF1/CF2/CF3 FV: 0 My benefit was $14,155.99 - my cost of $7,320.00 = $6,835.99. My answer is incorrect. What am i doing wrong?Assume you invest $5,100 today in an investment that promises to return $6,928 in exactly 10 years. a. Use the present-value technique to estimate the IRR on this investment. b. If a minimum annual return of 9% is required, would you recommend this investment? #69 Part 1 a. The IRR of the investment is enter your response here%. (Round to the nearest whole percent.) Part 2 b. If a minimum return of 9% is required, would you recommend this investment? (Select the best choice below.) A. No, because this investment yields less than the minimum required return of 9%. B. Yes, because a minimum required return of 9% does not compensate for an investment that lasts longer than one year. C. No, because a minimum required return of 9% is an arbitrary choice for an investment of this risk level. D. Yes, because this investment yields more than the minimum required return of 9%