5. Use the calculator and Excel to answer the following: a. You want to become a millionaire (reaching 1 million dollars!). You want to know how long it will take you to get there if you plan on saving $1,250 monthly, and the current annual rate is 12%. (It will take you less than you think...) i. Formula n = log (FV/PV) / log (1 + r) ii. Estimate it in your Calculator: Write the keys you enter iii. Excel: Write the formula and arguments in Excel format. b. Your grandfather gave you $25,000 as a graduation gift. If you invest that money earning 9% per year, how much will you have in 10 years? iv. Formula: Plug in the values in the formula v. Calculator: Write the keys you enter vi. Excel: Write the formula and arguments in Excel format. c. What would you pay today for a piece of paper that promises you to get $67,000 in 12 years if the current discount rate is 9 percent? vii. Formula: viii. Calculator: Write the keys you enter ix. Excel: Write the formula and arguments in Excel format.

5. Use the calculator and Excel to answer the following: a. You want to become a millionaire (reaching 1 million dollars!). You want to know how long it will take you to get there if you plan on saving $1,250 monthly, and the current annual rate is 12%. (It will take you less than you think...) i. Formula n = log (FV/PV) / log (1 + r) ii. Estimate it in your Calculator: Write the keys you enter iii. Excel: Write the formula and arguments in Excel format. b. Your grandfather gave you $25,000 as a graduation gift. If you invest that money earning 9% per year, how much will you have in 10 years? iv. Formula: Plug in the values in the formula v. Calculator: Write the keys you enter vi. Excel: Write the formula and arguments in Excel format. c. What would you pay today for a piece of paper that promises you to get $67,000 in 12 years if the current discount rate is 9 percent? vii. Formula: viii. Calculator: Write the keys you enter ix. Excel: Write the formula and arguments in Excel format.

Essentials Of Investments

11th Edition

ISBN:9781260013924

Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Chapter1: Investments: Background And Issues

Section: Chapter Questions

Problem 1PS

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Similar questions

Your friend offers you an investment opportunity that would yield $100 per year for the next 3 years. Using a discount rate of 10%, decide whether this is a good investment opportunity. What is the present value of this investment? a. $200.05 b. $250 c. $248.68 d. 258.20
How much time will it take you to accumulate $500,000, assuming you invest $15,000 today and $150/ month, and can earn a monthly return of 1%? Next, How would this answer change if there was no upfront investment?
(Related to Checkpoint 5.6) (Solving for ) You are considering investing in a security that will pay you $3,000 in 34 years. a. If the appropriate discount rate is 8 percent, what is the present value of this investment? b. Assume these investments sell for $773 in return for which you receive $3,000 in 34 years. What is the rate of return investors earn on this investment if they buy it for $773? a. If the appropriate discount rate is 8 percent, the present value of this investment is $ 219.13. (Round to the nearest cent.) b. The rate of return investors can earn on this investment if they buy it for $773 is %. (Round to two decimal places.)
Using the previous table, enter the correct factor for three periods at 5%: Future value x Factor = Present value $8,000 x = $6,912 You may want to own a home one day. If you are 20 years old and plan on buying a $200,000 house when you turn 30, how much will you have to invest today, assuming your investment yields an 8% annual return? $fill in the blank 8f0fa5fb3029fb7_2 USE SNIPPET TO ANSWER
Student A wishes to invest in cryptocurrency, how long will it take to double his investment when he can have a gain of 6% effective annual rate?
(Use Calulator or Formula Approach) You are offered an investment that will pay you $200 in one year, $400 the next year, $600 the next year and $800 at the end of the fourth year. You can earn 12 percent on very similar investments. What is the most you should pay for this one?
To get the answer Step 1 plug everything using n=30 and you will have 0 for fv. Solve for pv Step 2 n= 2 and wte u got for pv in stdp 1 will go into fv. Pmt will be 0. Solve for pv
Suppose you invest $1000 and two years later you cash out for $1300. Your internal rate of return is closest to?: 12% 14% 15% 30%
Julie wants to borrow $10,250 from you. She has offered to pay you back $12,250 in a year. If the cost of capital of this investment opportunity is 12%, what is its NPV? Question content area bottom Part 1 The NPV of the investment is $enter your response here. (Round to the nearest cent.)
Find the required value for each problem. Show the formula used and the counts for each problem. 6. How much more would you earn in three years if you invest $ 10,000 at a compound annual interest rate of 5.75%, instead of at a simple interest rate of 5.75%? 7. What would be the compound annual interest rate you would need to double your investment of $ 1,000 in three years? 8. If your bank pays you 5% annual interest, compounded monthly, how much would you have in ten years if you invest $ 1,000 today? 9. How much would you have to deposit today in a bank account that pays 9.25% annual interest, compounded quarterly, if you expect to have $20,000 at the end of five years? 10. Suppose you invested $ 2,500 in the business that a friend opened and in three years this friend returned $ 3,700 to you. How much was the return on your investment in your friend's business?
6. You are considering an investment that will pay you $1,000 in one year, $2,mm in two years, and $3,000 in three years. If you want to earn 10% on yourmoney, how much would you be willing to pay?
4

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