Problem 4-25 Calculating Rates of Return You're trying to choose between two different investments, both of which have up-front costs of $64,000. Investment G returns $124,000 in seven years. Investment H returns $184,000 in 11 years. Calculate the rate of return for Investments G and H. (Do not round intermediate calculations and enter your answers as a percent rounded to 2 decimal places, e.g., 32.16.) Investment G Investment H % %

Problem 4-25 Calculating Rates of Return You're trying to choose between two different investments, both of which have up-front costs of $64,000. Investment G returns $124,000 in seven years. Investment H returns $184,000 in 11 years. Calculate the rate of return for Investments G and H. (Do not round intermediate calculations and enter your answers as a percent rounded to 2 decimal places, e.g., 32.16.) Investment G Investment H % %

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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QUESTION 7 If you have $100K, and want to invest in assets A, B and C. Asset A has historical AVG return of 15%, asset B 20%, and asset C 10%, in what proportions of $100K would you allocate into assets A, B and C? i.e. Which scenario is most rational? A > B > C A > C > B B > A > C C >A > B
es The four people below have the following investments. Invested Amount $ 11,800 14,800 21,800 17,800 Jerry Elaine George Kramer Req 1A Interest Rate Required: 1-a. Calculate the future value at the end of three years. (FV of $1, PV of $1, FVA of $1, and PVA of $1) 1-b. Who has the greatest investment accumulation? Req 1B Jerry Elaine George Kramer 12% 8 7 9 Complete this question by entering your answers in the tabs below. Compounding Quarterly Semiannually Future Value Annually Annually Calculate the future value at the end of three years. Note: Use Excel or a financial calculator. Round your answers to 2 decimal places. 2
Solving for Unknown Variables for Different Investments Solve for the unknown variables in each of the four separate investment scenarios. Assume interest is compounded annually in each case. Round final answer to the nearest whole number or percentage point. Use a negative sign only for an amount related to PV. Investment 1 Investment 2 Investment 3 Investment 4 RATE Answer 7% 4% 6% NPER 4 Answer 12 10 PV $(14,500) $(63,800) Answer $(237,800) FV $23,200 $101,500 $52,200 Answer
Question 7 Consider the two investments shown in the table. Find the present value of each at Year 0 assuming an interest rate of 5%. What is the percentage difference in the present values (with Investment 1 as the base of the percentage)? Year 0 1 2 3 Investment #1 Investment #2 $0 $100. $100 $1,100 $0 $100 $1,100 $0
Multiple Choice Assume you are investing $100 today in a savings account. Which one of the following terms refers to the total value of this investment one year from now? о O O Future value Present value Principal amount Discounted value Invested principal 5 Saved Help Save & Exit 8 Submit
Part Two-Solving for Unknown Argument The following four investment cases are missing the value of one key argument. Solve for the unknown argument in each separate case. Assume interest is compounded annually •Note: Round your answers to the nearest whole number or percentage point. •Note: Do not use a negative sign (-) with your answers. RATE (a) NPER PV FV Investment 1 0% 8 (b) $(6,400) $9,600 Investment 2 6% 0 Investment 3 6% 4 0 $3,120 (d) $ $(6,187) (c) $ $8,280 Investment 4 5% 3 $(8,000) 0
uppose you had the following propositions of returns from two companies W and Y: Company Returns (OMR) Comments W 1204 Company W proposes to give 1204 Rial today Y 1550 Company Y proposes to give you 1550 but after 2 years You also know that the Interest Rate is by 10%.Question: In which company do you choose to invest your money and why?
QUESTION 42 Compute the missing variable for each of the following alternatives of investments to accumulate $1,000,000. for 30 years @ 6% annual interest rate: Following are appropriate factors from tables: Table % / n Present Value of annuity due $1 Present Value of ordinary annuity of $1 Present value of $1 Future Value of ordinary annuity of $1 6%/30 12.15812 13.76483 .17411 79.05819 $????????? invested annually at the end of the year. Required Computations: $12,648.91 $72,648.92 $33,3333.33 $11,927.43
Appendix F - HW Question 5 of 5 - View Policies Show Attempt History Current Attempt in Progress Your answer is incorrect. Patricia Quick made an investment of $7,909.96. From this investment, she will receive $1, 100 annually for the next 15 years starting one year from now. Click here to view the factor table What rate of interest will Patricia's investment be earning for her? (Hint: Use Table 4.) (For calculation purposes, use 5 decimal places as displayed in the factor table provided. Round answer to 0 decimal places, e.g. 25 %.) Qate of interest %
sd subject-Accounting You are considering an investment that will pay $24668 in 20 years. If the interest rate is 13.79%, what is the most you should be willing to invest today? (Round to 2 decimal places.)
QUESTION 42 Compute the missing variable for each of the following alternatives of investments to accumulate $1,000,000. for 30 years @ 6% annual interest rate: Following are appropriate factors from tables: Table % / n Present Value of annuity due $1 6%/30 12.15812 $33,3333.33 O $72,648.92 Present Value of ordinary annuity of $1 13.76483 Present value of $1 .17411 $????????? invested annually at the end of the year. Required Computations: O $12,648.91 O $11,927.43 Future Value of ordinary annuity of $1 79.05819
Question 1 Q1(a) Create simple examples to illustrate the following concepts. i. Time value of money ii. Effective interest Sinking Fund 111. iv. Amortized loan Q1(b) Assuming you will be able to deposit GHC6000 at the end of each of the next four years in a bank account paying 9% interest. You currently have GHC6000 in the account. How much will you have in four years? Q1(c) After carefully going over your budget, you have determined you can afford to pay GHC854 per month toward a new car. You call up your local bank and find out that the going rate is 1% per month for 48 months. How much can you borrow? Q1(d) Suppose, a business takes out a GHC7000, 7-year loan at 9%. If the loan agreement calls for the borrower to pay the interest on the loan balance each year and to reduce the loan balance each year by GHC 1000. How would the loan repayment be? Illustrate with the aid of a table.

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