Feedback Introduction to Finance

1991 Words Aug 15th, 2013 8 Pages
Quiz Feedback | Introduction to Finance

12/07/13 18:50

Feedback — Assignment 3
Thank you. Your submission for this quiz was received.

You submitted this Assignment on Sun 7 Jul 2013 10:22 AM PDT (UTC -0700). You got a score of 90.00 out of 100.00.

Please read all questions and instructions carefully. Note that you only need to enter answers in terms of numbers and without any symbols (including $, %, commas, etc.). Enter all dollars without decimals and all interest rates in percentage with up to two decimals. Read the syllabus for examples.The points for each question are listed in parentheses at the start of the question, and the total points for the entire assignment adds up to 100.

Question 1
(5 points) Sachin has asked his flat
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You know how to set up and calculate NPV.

10.00 / 10.00

Question Explanation A fairly common NPV problem

Question 5
(10 points) Yassein is looking to refinance his home because rates have gone down from when he bought his house 10 years ago. He started with a 30-year fixed-rate mortgage of $288,000 at an annual rate of 6.5%. He can now get a 20-year fixed-rate mortgage at an annual rate of 5.5% on the remaining balance of his initial mortgage. (All loans require monthly payments.) In order to re-finance, Yassein will need to pay closing costs of $3,500. These costs are out of pocket and cannot be rolled into the new mortgage. How much will refinancing save Yassein? (i.e. What is the NPV of the refinancing decision?) Your Answer 15463 16975  10.00 Correct. This is a very common situation we all face all the time. 17517 16467 Total 10.00 / 10.00 Score Explanation

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Quiz Feedback | Introduction to Finance

12/07/13 18:50

Question Explanation A problem we saw last week, but I expect you to do this routinely now. It is a value generating opportunity through financing only because interest rates changed.

Question 6
(10 points) Chandra has the opportunity to buy a vacant lot next to several commercial properties for $50,000. She plans to buy the property and spend another $60,000