Jesse borrowed $30,000. The company plans to set up a sinking fund that will repay the loan at the end of 8 years. Assume 12% interest rate compounded semiannually. What must his company pay into the fund each period of time?
Q: A potential employer needs Katie's permission to review her credit report. True False
A: Credit report-It provides the following information i) Credit card account information ii) Available…
Q: 24. A 10-years Treasury bond paying a 5% coupon annually is priced at USD 92.64. What is the yield…
A: Face value = $100 Coupon rate = 5% Coupon amount = 100*0.05 = $5 Price of bond = $92.64 Years to…
Q: Edgar Garcia was at his banker's trying to get a short term loan. "I need about $10,000 for three…
A: Cash flow is important for any business, as it enables the business to meet its current obligations…
Q: What Is the Difference Between Preferred Stock and Common Stock?
A: Common shares are issued by the company when they want to distribute their ownership and common…
Q: Stephanie Carter has been gifted a sum of $50,000 by her grandparents on completing her graduation…
A: Particulars Pan Elixir Rebound Cheers Think local Last year dividend $2.50 $0.50 $1.00 $0.75…
Q: Melissa is starting a savings for the initial capital to start a jewelry company right after…
A: With number of compounding in a year (n) and nominal interest rate (i), the effective annual…
Q: Rio Coffee Shoppe sells two coffee drinks - a regular coffee and a latte. The two drinks have the…
A: The Break-even point refers to the point at which the company is earning no profit or loss and total…
Q: Dow Chemical Corporation plans to build a laboratory dedicated to a special research and development…
A: As perGAAP, Project or any specific research assets such as buildings and equipment having no…
Q: The most liquid asset is:* A. A car B. A computer C. A house D. Money in a checking account E.…
A: An asset that is easily convertible into cash and can be done so quickly is referred to as being…
Q: Ogren Corporation is considering purchasing a new spectrometer for the firm’s R&D department. The…
A: Cashflow The cash which flows inward and outward from the business or the project is known as cash…
Q: Choose the best description of the goal of the financial manager in a corporation where shares are…
A: Financial manager in a corporation where shares are actively traded will try to maximize the…
Q: (4) Given A(5)= P7, 500 and A(11) = P9,000. What is principal (beginning) balance assuming compound…
A: Balance at year 5 (A5) = P7,500 Balance at year 11 (A11) = P9,000 Period from year 5 to 11 (n) = 6…
Q: a. If the tax rate is 21 percent, what is the project's Year O net cash flow? Year 1? Year 2? Year…
A: Information Provided: Initial Investment = $2.29 million Annual sales = $1,790,000 Annual costs =…
Q: Shares in SergeantPepper will earn a return of 6.00% during a bull market, and 6.10% during a bear…
A: To Find: covariance of the two security returns
Q: Bank A pays 5% interest compounded annually on deposits, while Bank B pays 4.25% compounded daily.…
A: Given, Bank A pays 5% compounded annually Bank B pays 4.25% compounded daily.
Q: Stephanie will require a return of at least 9% on her stock investments. Rebound Tourism Inc. is a…
A: Maximum price of the stock is equal to sum of all future cashflows discounted at a required return…
Q: (1) The total amount of a loan to which interest has been added is P 200,000. The term of the loan…
A: Data given: Total interest = P200,000 t=4.5 years Simple interest = 6% Formula for simple interest…
Q: Stephanie Carter has been gifted a sum of $50,000 by her grandparents on completing her graduation…
A: Here, To Find: Yield to maturity of the bonds =?
Q: 9.You have a signed a partnership agreement distributing profits based on salary and investment with…
A: Partnership refers to an agreement between a person for running a business and earning as per the…
Q: 3. Which of the following statements about a stock's beta is true? (a) A beta greater than one is…
A: Beta is a measure of Systematic risk of a stock or portfolio. Generally, the market beta is always…
Q: Consider the following three-bond portfolio in which all the bonds are option free: Bond Price…
A:
Q: When visualising the distribution of a variable using a histogram, if only the right tail has…
A: A distribution's skewness is a measurement of its asymmetry. When a distribution's left and right…
Q: An unlevered firm has a value of $700 million. An otherwise identical but levered firm has $160…
A: Value of levered firm according to MM proposition with corporate taxes is calculated using following…
Q: Stephanie Carter has been gifted a sum of $50,000 by her grandparents on completing her graduation…
A: Particulars Pan Elixir Rebound Cheers Think local Last year dividend $2.50 $0.50 $1.00 $0.75…
Q: Compute bank discount using (A) ordinary interest, (B) proceeds, and (C) effective interest rate to…
A: 1) Bank Discount using Ordinary Interest Bank Discount = Face value * discount rate * Time period =…
Q: Using the information in Question 14 above, estimate the price of the bond for a 200 basis- O A.…
A: The duration of bond indicates the sensitivity of interest rate to the price of bond and it shows…
Q: Suppose risk-free rate of return = 2%, market return = 7%, and Stock B’s return = 11%. Calcuate…
A: The Expected return is calculated by using Capital Asset Pricing Model. It is calculated with the…
Q: ou borrow $210,000; the annual loan payments are $18,653.76 for 30 years. What interest rate are you…
A: Yield to maturity can be calculated by following function in excel =RATE (nper, pmt, pv, [fv],…
Q: 4. Luke A. Manufacturing paid a dividend yesterday of $5 per share (D0 = $5). The dividend is…
A: D0 = $5 Growth rate (g) = 0.07 Stock price (P0) = $22 Flotation cost (F) = $2.50 Cost of new common…
Q: Course: Financial Mathematics An investor places a capital at 50% for 3 years and then withdraws 20%…
A: Simple Interest = Principal * rate % * time Let the investment be x. Initial Investment – X Time…
Q: Over the next year, there is a 78% chance of the market being in state 1, otherwise it is in state…
A: To Find: Covariance of the two security returns
Q: g the past five years, you owned two stocks that had the following annual rates of return: Year…
A: Arithmetic mean, standard deviation and coefficient of variations are used is in finance to know the…
Q: You want to retire in 40 years as a millionaire (i.e., to have $1,000,000). If 6% is the average…
A:
Q: The total amount of a loan to which interest has been added is P 200,000. The term of the loan was…
A: Simple interest is the interest on the principal amount only and there is no interest on interest…
Q: An antitrust case has lead to you having to calculate a fair return (using the CAPM) for…
A: Fair Return = Risk Free Return + Beta ( Market return - Risk Free Return) Beta = Correlation between…
Q: Calculate the average daily balance and finance charge on the statement below. Note: Round your…
A: Credit cards are personal debt financing that is provided to customers by financial institutions. It…
Q: Hong took out a $10,000 loan for 73 days and was charged simple interest. The total interest he paid…
A: The annual Interest rate is calculated with the help of following formula Annual Interest rate =…
Q: c=$6, K=$30, S=$50, r=5%, T=3months WHAT IS THE LOWER BOUND OF CALL? Is there an arbitrage…
A: Call premium is $6 Strike price K is $30 Spot price is $50 Risk free rate is 5% Time period is 3…
Q: ind the future values of the following ordinary annuities: FV of $300 paid each 6 months for 5…
A: Future value can be calculated using FV (rate, nper, pmt, [Pv], [type]) Rate The interest rate Nper…
Q: Beale Manufacturing Company has a beta of 1, and Foley Industries has a beta of 0.65. The required…
A: Beale Manufacturing Company Beta is 1 Foley Industries beta is 0.65 Market return is 10.5% Risk free…
Q: c. Courteney-Cox, Inc., is a Texas-based manufacturer and distributor of components and replacement…
A: Solution: Calculation of the minimum certainty equivalent adjustment factor for each project is…
Q: On 1 June, shares in Blue.com traded at $30.58. Your broker allowed you to buy the shares on margin…
A: Given: Purchase price = $30.58 Closing price = $26.42 Initial margin = 60%
Q: You plan to take a 15-year mortgage in the amount of $400,000 to buy a home. The bank charges 4%…
A: Given, Mortgage amount is $400,000 Rate is 4% term is 15 years
Q: $20,500 is invested in this portfolio which consists of stocks Netflix (NFLX) and Amazon (AMZN).…
A: To Find: Portfolio Expected return Portfolio Standard Deviation
Q: A lender offers you a $125,000, 30 year mortgage with monthly payments of $769.65. What’s the…
A: The lender charges the interest from the borrower in exchange for extending the loan. The borrower…
Q: a. At an effective rate of interest of 8% per annum, the present value of P 100,000 due in x is…
A: Present value is the equivalent value today based on the interest rate and period of interest and…
Q: Calculate the price of a $1,000, 5% bond with three years to maturity with 7.5% market interest…
A: The Price of Bond is calculated with the help of following formula Price of Bond = Present Value of…
Q: In a geometric sequence of annual cash flows starting at the EOY zero, the value of A0 is $65,217.50…
A: A0 is $65,217.50 A10 is $263,841 Discount rate is 20% To Find: Equivalent value of A for years 1…
Q: ear ago the Jenkins Family Fun Center deposited $5000 in an investment account for the purpose of…
A: Future value of amount includes the amount being deposited and interest amount account accumulated…
Q: You’re called out of an investment committee meeting at your real estate company for an important…
A: Analysis of various descriptions on comparable properties: Description Analysis Distance from…
Jesse borrowed $30,000. The company plans to set up a sinking fund that will repay the loan at the end of 8 years. Assume 12% interest rate compounded semiannually. What must his company pay into the fund each period of time?
Step by step
Solved in 2 steps
- Ted Houser wishes to accumulate a fund of $40,000 for the purchase of a house and lot. He plans to deposit $4,000 semiannually at the end of each 6 months. Assuming interest at 14% a year compounded semiannually, how many deposits of $4,000 each will be required, and what is the amount of the last deposit?Kyle borrowed P100,000 to be paid in 10 years, and established a sinkingfund to provide for the payment of this obligation. The deposits with thefund will be made at the end of every six months. If money is worth 8%compounded semi-annually, what should be the amount of each deposit.John borrows $10,000 for 10 years and uses a sinking fund to repay the principal. The sinkingfund deposits earn an annual effective interest rate of 5%. The total required payment for both the interestand the sinking fund deposit made at the end of each year is $1,445.04. Calculate the annual effectiveinterest rate charged on the loan.
- Mr. Deneau accumulated $98000 in an RRSP. He converted the RRSP into a RRIF and started to withdraw $5400 at the end of every three months from the fund. If interest is 4.1% compounded annually, for how long can Mr. Deneau make withdrawals? State your answer in years and months (from 0 to 11 months).3. An engineer deposits 12.5% of his salary to an investment fund. This amounts to deposits of P100, 000 yearly for ten years. At the beginning of the third and sixth year he deposits an additional P25, 000 on top of his regular annual deposit. How much money can he withdraw from the fund ten years from now, if the rate of return is 15.2% annually?Mr. Canlapan deposited his money from selling his old vehicle. The fund would allow him to withdraw 45,000 pesos semi-annually for 5 years starting at the end of 1 year. How much is the amount deposited if the interest rate is 2% converted semi-annually?
- A man buys a house for $350,000. He makes a $150,000 down payment and amortizes The rest of the purchase price with semi annual payments over the next 10 years. The interest rate on the debt is 13% compounded semi annually. A.find the size of each payment B.find the total amount paid for for the purchase C.find the total interest paid over the life of a loanA couple secured a 4,000,000 php housing loan from a financing company that gives 12% interest compounded monthly. They plan to amortize the loan for 20 years with monthly regular payments. On their 100th payment, how much of this amount goes to the interest payment, and how much is apportioned to the repayment of the principal?Jaime Bickers invests $4000 at the end of each semiannual period for 8 years. His financial advisor told him the funds should earn about 6% compounded semiannually. Find the amount of the annuity.
- A man borrowed $1000 from a bank at 8% interest. He agreed to repay the loan in two end-of-year payments. At the end of each year, he will repay half of the $1000 principal amount plus the interest that is due. Compute the borrower’s cash flow.Troy Long wishes to deposit a single sum of money in a savings account so that five equal annual withdrawals of $2,000 can be made before depleting the fund. If the first withdrawal is to occur 1 year after the deposit and the fund pays interest at a rate of 5% compounded annually, how much should he deposit? suppose the first withdrawal does not occur until 3 years after the deposit. How much should be deposited?A company wants to accumulate a sum of money to repay certain debts due in the future. The company will make annual deposits of $175,000 into a special bank account at the end of each of 10 years. Assuming the bank account pays 8% interest compounded annually, what will be the fund balance after the last payment is made in ten years?
