Your best friend has just started a new business and is looking for investors. She promises to pay $300 one year from today and $700 in two years. Assuming a discount rate of 11%, how much would you be willing to invest today? $900.53 $838.41 $1,291.08 $1,732.99
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Your best friend has just started a new business and is looking for investors. She promises to pay $300 one year from today and $700 in two years. Assuming a discount rate of 11%, how much would you be willing to invest today?
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$900.53 |
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$838.41 |
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$1,291.08 |
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$1,732.99 |
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- Through your career, you have saved-up $1,150,000. You are now ready to retire. You discuss your plans with your bank's financial adviser. He informs you that you can establish an annuity that will pay $68,000 per year for 25 years. What is the implied rate the bank is offering? O 3.58% ○ 2.75% O 3.26% ○ 3.40%Assume that you own an annuity that will pay you $15,000 per year for 12 years, with the first payment being made today. You need money today to start a new business, and your uncle offers to give you $160,000 for the annuity. If you sell it, what rate of return would your uncle earn on his investment? O 2.28% O 2.20% O 2.22% 2.33% 2.59%Suppose you deposited $39,000 in a bank account that pays 5.25% with daily compounding based on a 360-day year. How much would be in the account after 8 months, assuming each month has 30 days? Select the correct answer. O a. $40,389.07 O b. $40,375.67 O c. $40,402.47 d. $40,368.97 Oe. $40,382.37
- Assume that you own an annuity that will pay you $14,000 per year for 12 years, with the first payment being made today. You need money today to start a new business, and your uncle offers to give you $125,000 for the annuity. If you sell it, what rate of return would your uncle earn on his investment? a. 11.20% b. 4.46% c. 4.87% d. 20.01% e. 5.90%< A friend asks to borrow $51 from you and in return will pay you $54 in one year. If your bank is offering a 6.2% interest rate on deposits and loans: a. How much would you have in one year if you deposited the $51 instead? b. How much money could you borrow today if you pay the bank $54 in one year? c. Should you loan the money to your friend or deposit it in the bank?Today you are opening a savings account and depositing an initial $5,000 into it. You plan to deposit $6,500 into the account two years from today and deposit another $8,000 four years from today. How much will you have in your account five years from today if you earn an 11 percent rate of return? A) $25,314.60 B) $26,194.89 C) $32,858.63 D) $29,602.37 (Please try to explain by using a Financial Calculator)
- Your client is 45 years old, and she wants to begin saving for retirement, with the first payment to come one year from now. She can save $6,000 per year, and you advise her to invest it in securities which you expect to provide an average annual return of 11 percent. If she follows your advice, how much money would she have at age 65? a. $133,200.00 b. $967,477.38 c. $48,373.87 d. $427,590.86 e. $385,216.99You are thinking about purchasing an investment from Get-Rich-Quick Investmemnt company. If you buy the investment, you will receive $50 every month for five(5)years. Payment will be made at the end of each month. If your required rate of return is 9% how much should you be willing to pay for this investment? Group of answer choices $4,632.87 $2,735.25 $2,525.10 $2,408.67A friend asks to borrow $47 from you and in return will pay you $50 in one year. If your bank is offering an 6.5% interest rate on deposits and loans: a. How much would you have in one year if you deposited the $47 instead? b. How much money could you borrow today if you pay the bank $50 in one year? c. Should you loan the money to your friend or deposit it in the bank? a. How much would you have in one year if you deposited the $47 instead? If you deposit the money in the bank today you will have $____ in one year. (Round to the nearest cent.)
- An insurance agent just offered you a new insurance product that will provide you with $1,959.20 13 years from now if you invest $400 today. What annual rate of interest would you earn if you invested in this product?Suppose you are offered an investment that will allow you to double your money in 8 years. You have R10 000 to invest. What is the implied rate of interest?Suppose you have a 1-year old daughter and you want to provide R81 000 in 19 years towards her college education. You currently have R2 000 to invest. What interest rate must you earn to have the R81 000 when you need it?Suppose you want to buy a new house. You currently have R15 000 and you figure you need to have a 10% down payment plus an additional 5% of the loan amount in closing costs. If the type of house you want costs about R150 000 and you can earn 8.1% per year, how long will it be before you have enough money for the down payment and closing costs?A friend asks to borrow $53.00 from you and in return will pay you $56.00 in one year. If your bank is offering a 5.7% interest rate on deposits and loans: a. How much would you have in one year if you deposited the $53.00 instead? b. How much money could you borrow today if you pay the bank $56.00 in one year? c. Should you loan the money to your friend or deposit it in the bank? a. How much would you have in one year if you deposited the $53.00 instead? If you deposit the $53.00 in the bank today, you will have $ in one year. (Round to the nearest cent.)
