A friend wants to open a roller disco (why not?). This will require an investment of $40,000 from you at the end of year 1, after which time you v receive annual dividends of $10,000 at the end of each of the 7 subsequent years. All of this is shown in the table below. The blue cells are currently blank Period Number 1. 4 6. 8. 1-Oct- 1-Oct- 1-Oct- 1-Oct- 1-Oct- 1-Oct- Start of period Number 1-Oct-15 16 1-Oct-22 17 18 19 20 21 30-Sep- 30-Sep- 30-Sep- 30-Sep- 30-Sep- 30-Sep- 30-Sep 30-Sep- End of period Date 2016 17 18 19 20 21 22 23 Investment appraisal Cashflow (S40,000) $10.000 $10,000 $10,000 $10,000 $10,000 $10.000 $10,000 NPV of %24 3D cashflow Internal Rate of Return (IRR) Open Microsoft Excel and copy and paste the information from the table above into a spreadsheet (to paste as a table use the "Paste Special" feature and paste as Text. Format appropriately). Create formulas to calculate and show that: • The Net Present Value for the investment at a discount rate of 8% is $11,170.09 - The Internal Rate of Return for the investment is 16.33% Would you make this investment?

A friend wants to open a roller disco (why not?). This will require an investment of $40,000 from you at the end of year 1, after which time you v receive annual dividends of $10,000 at the end of each of the 7 subsequent years. All of this is shown in the table below. The blue cells are currently blank Period Number 1. 4 6. 8. 1-Oct- 1-Oct- 1-Oct- 1-Oct- 1-Oct- 1-Oct- Start of period Number 1-Oct-15 16 1-Oct-22 17 18 19 20 21 30-Sep- 30-Sep- 30-Sep- 30-Sep- 30-Sep- 30-Sep- 30-Sep 30-Sep- End of period Date 2016 17 18 19 20 21 22 23 Investment appraisal Cashflow (S40,000) $10.000 $10,000 $10,000 $10,000 $10,000 $10.000 $10,000 NPV of %24 3D cashflow Internal Rate of Return (IRR) Open Microsoft Excel and copy and paste the information from the table above into a spreadsheet (to paste as a table use the "Paste Special" feature and paste as Text. Format appropriately). Create formulas to calculate and show that: • The Net Present Value for the investment at a discount rate of 8% is $11,170.09 - The Internal Rate of Return for the investment is 16.33% Would you make this investment?

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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Similar questions

PLEASE, PERFORM THE EXERCISE IN EXCEL AND SHOW THE FORMULASProblem 5:An account executive at Santander branch CETYS, receives a deposit from an important client-student, surnamed Cuevas Ronchas for $30,000.00; in an account that generates 6% interest, capitalizable monthly. After two years, he decides to make new deposits at the end of each year, so that after three years from this decision, he has $200,000.00 at the time of the last deposit. Find the amount of annual deposits he has to make for the last 3 years. The solution involves calculating a future value and then a present value. Note:In the image, this is the original exercise, it is in Spanish, but it is easy to understand. Very important Note:It is necessary that you make a solution approach and then the result. Above all, to check the procedure and/or the formulas used, especially when you use excel. Please, not in written form, please do it in excel Please, not in written form, please do it in excel Please, not in written…
PLEASE, PERFORM THE EXERCISE IN EXCEL AND SHOW THE FORMULASProblem 5:An account executive at Santander branch CETYS, receives a deposit from an important client-student, surnamed Cuevas Ronchas for $30,000.00; in an account that generates 6% interest, capitalizable monthly. After two years, he decides to make new deposits at the end of each year, so that after three years from this decision, he has $200,000.00 at the time of the last deposit. Find the amount of annual deposits he has to make for the last 3 years. The solution involves calculating a future value and then a present value. Note:In the image, this is the original exercise, it is in Spanish, but it is easy to understand. Very important Note:It is necessary that you make a solution approach and then the result. Above all, to check the procedure and/or the formulas used, especially when you use excel.
A business owner plans to deposit his annual profits in an investment account earning a 9% annual return. If the owner starts with their first deposit today for $22,000 and expects to make the same profit for the next 7 years, how much will be saved for retirement at that point? Please check if my answer is correct, if not please correct me. Answer: Answer:1,200, n = 6, r = 9% (1+r)^n -1 /r (1+0.09%)^7 - 1/0.09 (1.09)^7 - 1/0.09 1.8280391208 -1/0.09 = 9.2004346756 22,000*9.2004346756 = $202,409.56
Computer Solutions’ success in the fourth quarter of 2022 has attracted the attention of David Wright,who considered investing in the company. A price of $15 per share was offered by Ramona, whichDavid accepted (a great way to start out the new year). The following transactions occurred betweenJanuary 1 and January 31, 2023, and need to be recorded in the general journal. Based on the initial success of Computer Solutions, David Wright invested an additional $15,000 cash in the company in exchange for 1,000 shares of the Company’s $10 par value common stock. (Reminder: anything paid in excess of par goes to Paid in Capital in Excess of Par. Can someone please help me with the general journal entry for this problem?
you are planning to start a business with an initial capital of P100,000. you decided to put up a fund with deposits made at the end of each month. if you want to gain the initial capital after 4 years, how much monthly deposit must be made? what should be the interest rate in order to achieve the possible amount needed? how are you going to invest your money that in short period of time so that you can start your business smoothly?
Suppose you inherited $100,000 and invested it at 7% per year. What is the most you could withdraw at the end of each of the next 10 years and have a zero balance at Year 10? How would your answer change if you made withdrawals at the beginning of each year? SHOW WORK AND USE FINANCIAL CALCULATOR
Theresa invested $5,000 in an account she expects will earn 8% annually. Approximately how many years will it take for the account to double in value? (Report an integer) (Hint: The easiest way to solve this problem is to use the "rule of 72".) (Note: Approximately, 1.3 is 1, not 2; and 1.5 is approximately 2.)
An investor has $100,000 to invest in a business venture, or she can earn 10%/year with a $100,000 certificate of deposit for 4 years. Three possible business ventures have been identified. Any money not invested in the business venture can be put into a bank account that earns 7%/year. Basedon a future worth analysis, what should be done with the $100,000?
You want to be able to withdraw $5000 from an account at the end of each year for the next 12 years. How much money should you invest now into an account earning 5.5% interest per year, compounded annually, in order to fund the desired withdrawals? Assume the account is empty after the last withdrawal is made. Give the answer to 2 decimal places, and do not use the $ sign in the answer box. The amount to invest now is Blank 1. Calculate the answer by read surrounding text. dollars.
You wish to purchase some equipment for a new business venture. You plan to save $35,000 per year. You will make 5 deposits in an account that pays 8.25%. Required: Determine how much you will have 5 years from today? Please show all working.
Suppose you inherited $200,000 and invested it at 6% per year. How much could you withdraw at the beginning of each of the next 15 years? use excel format
Melannie Bayless has purchased a business building for $331,000. She expects to receive the following cash flows over a 10-year period: Year 1: $43,000 Year 2: $58,500 Year 3-10: $89,000 What is the payback period for Melannie? Round your answer to one decimal place.fill in the blank What is the accounting rate of return? Enter your answer as a whole percentage value (for example, 16% should be entered as "16" in the answer box).fill in the blank

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