Abdullah has OMR 5000 to invest in a small business venture. His partner has promised to pay him back OMR 8200 in five years. What is the return earned on this investment? اخترأحد الخيارات a. 14.50 % b. None of these c. 12.40 % d. 10.39 % e. 10.75 %
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- LO.2, 11 Heather wants to invest 40,000 in a relatively safe venture and has discovered two alternatives that would produce the following reportable ordinary income and loss over the next three years: She is interested in the after-tax effects of these alternatives over a three-year horizon. Assume that Heathers investment portfolio produces sufficient passive activity income to offset any potential passive activity loss that may arise from these alternatives, that her cost of capital is 6%, that she is in the 24% tax bracket, that each investment alternative possesses equal growth potential, and that each alternative exposes her to comparable financial risk. In addition, assume that in the loss years for each alternative, there is no cash flow from or to the investment (i.e., the loss is due to depreciation), whereas in those years when the income is positive, cash flows to Heather equal the amount of the income. a. Based on these facts, compute the present value of these two investment alternatives and determine which option Heather should choose. Refer to Appendix H for the present value factors. b. Prepare your solution using spreadsheet software such as Microsoft Excel.LO.3, 11 Emily has 100,000 that she wants to invest and is considering the following two options: Option A: Investment in Redbird Mutual Fund, which is expected to produce interest income of 8,000 per year. Option B: Investment in Cardinal Limited Partnership (buys, sells, and operates wine vineyards). Emilys share of the partnerships ordinary income and loss over the next three years would be as follows: Emily is interested in the after-tax effects of these alternatives over a three-year horizon. Assume that Emilys investment portfolio produces ample passive activity income to offset any passive activity losses that may be generated. Her cost of capital is 8%, and she is in the 32% tax bracket. The two investment alternatives possess equal growth potential and comparable financial risk. a. Based on these facts, compute the present value of these two investment alternatives and determine which option Emily should choose. Refer to Appendix H for the present value factors. b. Prepare your solution using spreadsheet software such as Microsoft Excel.Stuart daniels estimates that he will need $22,000 to set up small business in 8 years. a) how much ( in $) must stuart invest now at 8% interest compound quartely to achieve his goal ? b) how much compound interest ( in $) will he earn on the investment.
- RT is about to loan his granddaughter Cynthia $20,000 for 1 year. RT’s TVOM, based upon his current investment earnings, is 8%. Cynthia’s TVOM, based upon earnings on investments, is 12%. Solve, a. Should they be able to successfully negotiate the terms of this loan? b. If so, what range of paybacks would be mutually satisfactory? If not, how far off is each person from an agreement?David wishes to provide his son with $18,000 on his 18th birthday. He invested $8,000 on his 5th birthday. On his son's 10th birthday he finds that he has earned 6.30% c.s.a. so far, but he estimates the rate will drop to 3.90% c.q. for the time remaining. Find the additional amount he must invest on his son's 10th birthday to achieve his objective. Sammie invested $18,750 on Feb 25th 2021 earning 5.15% c.s.a. How many years after will his account contain $23,500 ? Round your answer to two decimal place. Sam invested $17,000 at 6.00% c.s.a for 24 months, 8.75% c.q. for next 3 years and 6.25% c.m. for the next 5 years. Find the compound amount Brandy would like to have $25,950 in her account in 15 months. How much must she invest now if the interest rate is 5.30% c.q.? Your Answer:An investor who recently returned from overseas decided to invest in a venture proposed by leading investment company.The investor is expected to receive ten(10) sum payment of $5000 at the end of each year for ten(10)years.However payments increased by 5% on the second(2nd),10% on the fourth (4th),15% on the sixth(6th),20% on the eighth(8th) and 25% on the tenth(10th) payment. Calculate the sum that should be payed to him at an interest of 5%
- Abby invested P100,000.00. A part of it was invested in Business 101 at 4% yearly interest and another part of it at a Credit Cooperative at 7% interest. How much investment he made in Business 101 if his yearly income from the two investments is P5,950.00?George Green wishes to invest $8000.00 that he saved from his summer job. His bank offers 3.75% for a one-year term investment or 3.5% for a six-month term. a)How much will George receive (capital plus interest) after one year if he invests at the one-year rate? Round to nearest one. b)How much will he receive (capital plus interest) after one-year if he invests for six months at a time at 3.5% each time? This means George took the interest from the first investment transaction and included it in the principal for the second transaction. Round to nearest 100th. c)What would the one-year rate have to be to yield the same amount of interest when investing for six months at a time at 3.5% each time? Give your answer as a percentage round to nearest 100th .Komiko Tanaka invests $18,000 in LymaBean, Inc. LymaBean does not pay any dividends. Komiko projects that her investment will generate a 10 percent before-tax rate of return. She plans to invest for the long term. How much cash will Komiko retain, after-taxes, if she holds the investment for 5 years and then sells when the long-term capital gains rate is 25 percent? (Do not round intermediate calculations. Round your final answer to the nearest whole dollar amount.) What is Komiko’s after-tax rate of return on her investment in part (c)? (Do not round intermediate calculations. Round your percentage answer to 2 decimal places.) e. How much cash will Komiko retain, after taxes, if she holds the investment for 15 years and then she sells when the long-term capital gains rate is 15 percent? (Do not round intermediate calculations. Round your final answer to the nearest whole dollar amount.) f. What is Komiko’s after-tax rate of return on her…
- Mr Hammond is 45 years of age and has a life expectancy of 10 more years. Hewishes to invest $20,000 in an annuity that will make a level payment at the end ofeach year until his death. If the interest rate is 8%, what income can Mr Hammondexpect to receive each year? ,AP (7 Marks)b) Guinness Ghana Breweries Limited is a large corporation operating in Ghana. As partof the structure of the organization, it is realized that ownership and management areseparated. Assess the main implications of this separation.EV (10 marks)c) Examine with practical illustration why you would expect the managers to act inshareholders’ interests.AN (8 marksAbdullah is looking to invest for the next three years. He is looking to invest OMR 7500 today in a bank CD that will earn interest at 5.75 percent annually. How much will he have at the end of three years? Select one: a. 8780.75 OMR b. 8869.56 OMR c. 8000.43 OMR d. 8681.46 OMR e. None of theseKomiko Tanaka invests $13,000 in LymaBean, Inc. LymaBean does not pay any dividends. Komiko projects that her investment will generate a 10 percent before-tax rate of return. She plans to invest for the long term. a. How much cash will Komiko retain, after-taxes, if she holds the investment for five years and then she sells it when the long-term capital gains rate is 15 percent?