Essentials Of Investments
11th Edition
ISBN: 9781260013924
Author: Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher: Mcgraw-hill Education,
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For each of the following cases, indicate (a) to what interest rate columns and (b) what number of periods you would refer to in looking up the
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- Calculate the simple interest rate when P=$3600 , I=_160 and t=4 months. Round to the nearest hundredtharrow_forwardInterest rates or discount rates. Fill in the interest rates for the following table, , using one of the three methods below: FV a. Use the interest rate formula, r= PV - 1. b. Use the TVM keys from a calculator. c. Use the TVM function in a spreadsheet. Present Value Future Value Number of Periods Interest Rate 529.63 5 1,884.87 20 6.55 % (Round to two decimal places.) $17 207.92 $223,893.69 40 % (Round to two decimal places.)arrow_forwardAssume that we wish to determine the expected value and standard deviation of returns of Assets A. The expected returns of assets A and probabilty for each of the next 5 years are given in columns 1 and 2 respectively in the table. Find the expected value and standard deviation of returns for Asset A . Year Asset A Prob. 2019 18,00 0,25 2020 16,00 0,20 2021 13,00 0,15 2022 9,00 0,20 2023 11,00 0,20arrow_forward
- Required: Solve for the unknown number of years in each of the following. (Round your answers to 2 decimal places (e.g., 32.16).)arrow_forwardConsider the following table for an eight-year period: \table[[Year,T-bill return,Inflation],[1,7.48%,8.52% Solve for C. And D. only. -- a. and b. are taken care ofarrow_forwardA, B, Carrow_forward
- If the present discounted value of $1,562 received 7 years from now is $1,123, what is the interest rate, to the nearest 0.01%? Give typing answer with explanation and conclusionarrow_forwardFor each case, provide the missing information. Assume payments occur at the end of each period. (Use the present value and future value tables, the formula method, financial calculator, or a spreadsheet for your calculations. If using present and future value tables or the formula method, use factor amounts rounded to five decimal places X.XXXXX. Round all final answers to the nearest cent, $X.XX, and round the loan maturity date to the nearest whole year.) (Click the icon to view the cases.) Future Value of $1 table Future Value of an Ordinary Annuity table Future Value of an Annuity Due table Cases Amount borrowed Interest rate Number of periodic payments per year Maturity (in years) Periodic payment (1) (a) 4% 4 10 $ 10,354.90 (2) $ 675,000 $ 4% 2 10 (b) S CO (3) 456,000 6 % 1 (c) 81.685.59 (4) $ 750.000 12 % T (d) I Xarrow_forwardExample 1. Compound interest When interest is compounded continuously, the rate of change of the amount x of the investment is proportional to the amount present. In this case, the proportionality constant is the annual interest rate r (as a decimal); that is, dx/dt = rx. (a) If $2000 is invested at 8%, compounded continuously, find an equation for the future value of the investment as a function of time t, in years. (b) How long will it take for the investment to double? (c) What will be the future value of this investment after 35 years?arrow_forward
- Financearrow_forwardFor each of the following, compute the present value: (Do not round intermediate calculations and round your answers to 2 decimal places, e.g., 32.16.) Present Value Years 12 4 16 21 Interest Rate 4 % 9 12 11 Future Value $ 18,128 42,317 798,382 655,816arrow_forwardThe following investment requires a table factor for a period beyond the table. Calculate the new table factor and the present value (principal). Use Table 11-2. Round your new table factor to five decimal places and your present value to the nearest cent. Compound Amount New Table Factor Term of Nominal Interest Present Investment (years) Rate (%) Compounded Value $36,000 36 7 annually $ Need Help? Read Itarrow_forward
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