When Marilyn Monroe died, ex-husband Joe DiMaggio vowed to place fresh flowers on her grave every Sunday as long as he lived. The week after she died in 1962, a bunch of fresh flowers that the former baseball player thought appropriate for the star cost about $7. Based on actuarial tables, "Joltin' Joe" could expect to live for 39 years after the actress died. Assume that the EAR is 11.4 percent. Also, assume that the price of the flowers will increase at 3.6 percent per year, when expressed as an EAR. Assuming that each year has exactly 52 weeks, what is the present value of this commitment? Joe began purchasing flowers the week after Marilyn died.---**Multiple Choice Options:**- $4,715.03- $4,479.28- $4,950.79- $4,573.58- $4,856.49

Present value is the equivalent value today of the future cash flow based on time value of money and growth of that.weekly interest rate=r=weekly growth rate=g=Total weeks=39 x 52=2028Present value=Present value of commitment=$4712.41Option 1 is correctPresent value of commitment=$4712.41Option 1 is correct

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When Marilyn Monroe died, ex-husband Joe DiMaggio vowed to place fresh flowers her grave every Sunday as long as he lived. The week after she died in 1962, a bunch resh flowers that the former baseball player thought appropriate for the star cost abo $7. Based on actuarial tables, "Joltin' Joe" could expect to live for 39 years after t actress died. Assume that the EAR is 11.4 percent. Also, assume that the price of th lowers will increase at 3.6 percent per year, when expressed as an EAR. Assuming th each year has exactly 52 weeks, what is the present value of this commitment? J began purchasing flowers the week after Marilyn died. Multiple Choice

When Marilyn Monroe died, ex-husband Joe DiMaggio vowed to place fresh flowers her grave every Sunday as long as he lived. The week after she died in 1962, a bunch resh flowers that the former baseball player thought appropriate for the star cost abo $7. Based on actuarial tables, "Joltin' Joe" could expect to live for 39 years after t actress died. Assume that the EAR is 11.4 percent. Also, assume that the price of th lowers will increase at 3.6 percent per year, when expressed as an EAR. Assuming th each year has exactly 52 weeks, what is the present value of this commitment? J began purchasing flowers the week after Marilyn died. Multiple Choice

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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Ami has decided to be cryogenically frozen at the time of her death so that she can be resurrected once medical science has advanced far enough to keep her alive. In preparation, Ami places $161,367 into an investment account which earns an 7.4% rate of return per year. To her amazement, she is one day brought back to life. "How long has it been?" she asks. "245 years" the strangely dressed person replies. How much money is sitting in Ami's investment account? You are welcome to round to the nearest whole number. You need to be within $1 million of the correct answer.
Khalid purchases a new truck for work! If he paid $63,703 for it and it depreciates in value by 50% in the first 7 years, the value of the truck after 7 years is $ (Remember that money is expressed to two decimal places). ?
Logan starts an IRA (Individual Retirement Account) at the age of 30 to save for retirement. He deposits $⁢400 each month. Upon retirement at the age of 65, his retirement savings is $⁢943,445.01. Determine the amount of money Logan deposited over the length of the investment. Round to the nearest thousand dollars.
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Michael Howitt of Berkley, Michigan, recently had his gallbladder removed. His total bill for this surgery, which was his only health care expense for the year, came to $13,810. His health insurance plan has a $450 annual deductible and an 80/20 coinsurance provision. The cap on Michael's coinsurance share is $1,910. Round your answers to the nearest dollar. a. How much of the bill will Michael pay? b. How much of the bill will be paid by Michaels insurance?
A Civil Engineer deposited PHP7,000,000 on a bank that earns ten percent compounded annually. Seven years later he perished. His will states that his recipient is children's home which will be accepting the money in perpetuity a year after he expired. How much is the yearly fund the children's home will be receiving.
Imagine you are helping a client, Jill Pole, prepare for retirement Jill would like to withdraw $14,411 from her retirement fund exactly one month after she quits her job. Jill would like all subsequent monthly withdrawals to grow at an effective annual rate of 2.5%. Further, Jill would like to have her funds invested to earn an effective annual return of 7.7%. Jill expects to live for 26 years once she retires and does not plan to leave an inheritance. How much does Jill need to have in her retirement account on the day she retires in order to fund this stream of growing monthly distributions from her retirement account?.
The Rodriquez family is determined to purchase a $250,000 home without incurring any debt. The family plans to save $2,500 a quarter for this purpose and expects to earn APR of 7.65 percent. How long will it be until the family can purchase a home? 13.45 years 14.11 years 14.85 years 59.39 years 56.43 years
Mike wants to donate $5,000,000 to establish a fund to provide an annual scholarship in perpetuity. The fund will earn an interest rate of 4.47% p.a. compounded half-yearly (2=4.47% p.a.) and the first scholarship will be first awarded 3.5 years after the date of the donation. (b) Assume that two years after the donation, Mike needs to withdraw $1,000,000 from the fund and use the remaining amount to provide an annual scholarship in perpetuity. The time of the first scholarship will be unchanged (3.5 years after the date of the donation). What is the new annual scholarship amount (rounded to two decimal places)? a. 101959.37 O b. 206197.54 O c. 203631.53 O d. 207511.86
Bertha bought a new home entertainment system today from Andre's Electronics. She will receive a cash-rebate of $232.00 from Andre's Electronics today, pay $719.00 to Andre's Electronics in 1 year, receive a cash rebate of $1,638.00 from Andre's Electronics in 2 years, and pay $4,985.00 to Andre's Electronics in 4 years. If the discount rate is 18.38 percent, then what is the present value of the cash flows associated with this transaction? O $-1,744.87 (plus or minus 3 dollars) O $-2,211.42 (plus or minus 3 dollars) O $-530.14 (plus or minus 3 dollars) O $-1,200.61 (plus or minus 3 dollars) O none of the answers are within 3 dollars of the correct answer

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