An asset has a current price of ₱80.00 and it has an expected price of ₱95 in 6 months. In your assessment, the standard deviation (σ) is 0.45. The reference rate is 5.5%. The value to the short and to the long would be?
Q: At an annual rate of 6% which is the average yield of PAG-IBIG MP2, what is the future worth of P…
A: Annual rate (r) = 6% n = 4 years Present worth (P) = P 100
Q: The spot price of an investment asset is $50. The asset pays sure income of $5 in 6 months and the…
A: Using the Formula (stock price less present value of dividend ) * (1+rate)^no. of period
Q: The prospective maintenance expenses for a commercial heating, ventilating, and air-conditioning…
A: In column 2 , the annual maintenance expenses is given in dollars. The general price inflation…
Q: How many years must the cash flows last for the investment to be acceptable?
A: Time value of money: Any amount invested today earns an additional income, called interest…
Q: The real worth of P5000 investment is calculated at P6,445.71 five years from now, What is the…
A: First, let's calculate the nominal interest rate compounded annually. Let that interest rate be r.…
Q: For annual worth values of $30,000, $40,000, and $50,000 with chances of 20%, 20%, and 60%,…
A: The annual worth is the amount that will be the present worth of the amount that will be paid or…
Q: An investment pays $2,100 per year for the first 7 years, $4,200 per year for the next 7 years, and…
A: The discount rate is 8.20% compounding quarterly. The cash flows have a periodicity of 1 year.…
Q: An investment will have a future value equal to Php180,250 after 6 years. It has a nominal rate of…
A: Future value of the investment (F) = Php 180250 r = 10.5% per annum = 2.625% per quarter n = 6 years…
Q: If P12,000 is the present value of P12,600 due at the end of 9 months, then the annual simple…
A: Simple Discount refers to the discount in which the amount of interest is deducted. This is usually…
Q: A certain amount of money after a decade is said to b worth Php 12,000.00. If the interest rate…
A: first calculate the amount after first half present value = FV/(1+rate)n = 12,000/(1 + 1.1%/6)5*6 =…
Q: A firm is considering the following alternatives, each with a five year life. What is the IRR of the…
A: IRR is the rate of return a project generates through its lifetime expressed in annual terms. It is…
Q: An investment will have a future value equal to Php180,250 after 6 years. It has a nominal rate of…
A: The quarterly compounding refers to compounding 4-times a year. To reflect the compounding impact,…
Q: A company is considering an investment that will cost $759,000 and have a useful life of 6 years.…
A: NPV is the net current worth of cash flows that are expected to occur in the future.
Q: An investment will pay $2,445 two years from now, $3,433 four years from now, and $1,611 five years…
A: Present value is also known as a present discounted value, in which the future value of cash inflows…
Q: A certain amount of money after a decade is said to be worth Php 12,000.00. If the interest rate…
A: Future Value = 12,000 PHP 1 USD = 49 PHP Future Value in USD = 12,000 / 49 = 244.90 USD N = 10 years…
Q: Give your answer to this question correct to the nearest rand. Phindile invests R12 795,00 now and…
A: Under stock market, investor is figuring out the best investment in order to gain maximum returns.…
Q: If an investment of $45,000 is earning an interest rate of 4.00%, compounded annually, then it will…
A: The number of years that will take to reach $53,686.19 at given interest rate can be calculated…
Q: An investment of P40,000 has a revenue of X pesos at the end of the first and second year. Given a…
A: When net present worth is zero that means present value of cash flow is equal to initial investment…
Q: Salalah Mills has taken up a new project with an initial investment of 30000 OMR.The expected future…
A: Given:
Q: An investment requires an initial disbursement of € 2,500,000 and the duration of the project is 3…
A: The difference between the present worth of cash inflows and withdrawals over a time period is the…
Q: A 60-day $100,000 T-bill was bought for $99,500. What rate of return will be realized if the T-bill…
A: Given: Face value = $100,000 Present value = $99,500 Days = 60
Q: Suppose an investor is considering the purchase of a financial instru- ment that promises to deliver…
A: Semi Annual Period Cash Flow = 40 per semi Annual Period N = Number of semi annual periods = 4…
Q: If the current rate of interest is 5%, then the future value (FV) of an investment that pays $1,000…
A: The question is based on the concept of future value calculation of annuity payment, by use of…
Q: Para Co. is reviewing the following data relating to an energy saving investment proposal: Cost…
A: The projected worth of a fixed asset after the end of its lease term or usable life is known as the…
Q: The future value of an investment is Php5,500,000 while its present value is Php3,500,000. It has a…
A: Present value(PV) is Php3,500,000 Future value(FV) is 3,500,000 Time Period is 13 years Compounding…
Q: Salalah Wind Energy has taken up a new project with an initial investment of 50000 OMR.The expected…
A: The Profitability Index: The profitability index measures the quantum of the total present values of…
Q: Let the current asset price be 100 dollars and atter time T, the price either goes up to 110 dollars…
A: The probability of up move for T=0.5 years can be calculated by finding the up move factor and down…
Q: You are comparing two investments. The first pays 3 percent interest per month, compounded monthly,…
A: a) i) First investment: Rate of interest i =3% per month Number of compounding periods in one half…
Q: What is the present value if the money become Php158, 900 after 5 years of investment using 11.2%…
A: The present value is the present worth of the amount that will be paid or received in the future.
Q: Raysut cement has taken up a new project with an initial investment of 125000 OMR.The expected…
A: Capital project appraisal involves the evaluation of profitability and liquidity position based on…
Q: What is the profitability index of an investment with initial investment of OMR 6600 and net present…
A: Initial Investment = OMR 6600 Net Present Value = OMR 2100 Profitability Index = Present Value of…
Q: A company is considering an investment with the following estimated cash flows. But they are not…
A: The break-even investment: The break-even investment is the investment value that is equal to the…
Q: Suppose an asset will pay £10,000 for sure in 10 years’ time and is priced at £5,000 today. Suppose…
A: Future value :— Future is the value of a current asset at a Future date based on an assumed rate of…
Q: A certain amount of money after a decade is said to be worth Php 10,000.00. IF the interest rate…
A: Present Value = Future Value/(1+EAR)n EAR = (1+nominal rate/m)m -1 m is number of times interest…
Q: An investment pays 3000 in one year, 2000 at the end of the second year and 1000 at the end of the…
A: Hi, thanks for posting the question. But as per our Q&A guidelines, the first three subparts…
Q: An investment of $80,000 is expected to generate a net annual income of $27,000 for 5 years. If the…
A: Present worth can be calculated by using this equation Net Present worth = -investment -…
Q: An investment of s80.000 is expected to generate a net annuol income of $27,000 for 5 years f the…
A: Investment = 80,000 Net Annual Income = 27,000 for 5 years MARR = 13% Total Time Period = 20 years…
Q: Use present value tables to compute the present value of 10 equal payments of $15,000, with…
A: Present value: It can be defined as today’s worth of an investment to be received in the future,…
Q: An investment offers $6,800 per year for 20 years, with the first payment occurring one year from…
A: Present Value: The present value is the concept that states an amount of money today is worth more…
Q: A firm is considering the following alternatives, each with a five year life. What is the IRR of the…
A: Internal Rate of Return is the discounting rate where the net present value of the project is zero.
Q: An investment will have a future value equal to Php180,250 after 6 years. It has a nominal rate of…
A: Time Value of money states that each dollar has earning capacity hence a dollar today is worth more…
Q: Raysut cement has taken up a new project with an initial investment of 125000 OMR.The expected…
A: The company increase its capital by issuing the company's shares, bonds, debentures, etc., These are…
Q: An amount of R50000 is invested in a project that predicts the quarterly cash flow return over the…
A: Internal Rate of Return(IRR) is rate at which NPV is zero or IRR is rate at which discounted value…
Q: An investment offers $5,300 per year, with the first payment occurring one year from now. The…
A: Note: Since we only answer up to 3 sub-parts, we’ll answer the first 3. Please resubmit the question…
Q: A mining firm is offered for sale for Php 5.7M. On the basis of estimated production, an annual rate…
A: Given, Sale value of firm = Php 5,700,000 (P) Expected rate of return = 6.7% (r) No. of years = 10…
Q: We are examining a new project. We expect to sell 5,400 units per year at $68 net cash flow apiece…
A: Capital budgeting is the process by which a corporation examines potential large projects or…
An asset has a current price of ₱80.00 and it has an expected price of ₱95 in 6 months. In your
assessment, the standard deviation (σ) is 0.45. The reference rate is 5.5%. The value to the short
and to the long would be?
Step by step
Solved in 2 steps with 2 images
- An asset has a current price of $80 and it has an expected price of $95 in 6 months. In yourassessment, the standard deviation (σ) is 0.45. The reference rate is 5.5percent. The value to the short and to the long would be?Kk201. An asset produces $150 in two years, and $250 in four years, and the current price has been calculated toreflect a rate of return of 9% annually. Using the definition that convexity = second derivative of pricedivided by price, find the convexity of this asset evaluated at the annual yield rate of 9%.An engineering project has an investment amount of $126585 with an annual net profit of $53362 for 7 years. If the interest rate and average inflation rate are 15% and 6%, respectively, calculate the present worth of the entire period.
- On the London Metals Exchange, the price for copper to be delivered in one year is $5,820 a ton. (Note: Payment is made when the copper is delivered.) The risk-free interest rate is 2.00% and the expected market return is 8%. a. Suppose that you expect to produce and sell 10,000 tons of copper next year. What is the PV of this output? Assume that the sale occurs at the end of the year. (Do not round intermediate calculations. Enter your answer in millions rounded to 2 decimal places.) b-1. If copper has a beta of 1.28, what is the expected price of copper at the end of the year? (Do not round intermediate calculations. Round your answer to 2 decimal places.) b-2. Assume copper has a beta of 1.28. What is the certainty-equivalent end-of-year price?A proposed project which requires an investment of R10,000 (now) is expected to generate a series of five payments in constant rands. It begins with R6,000 at the end of first year but increasing at the rate of 5% per year thereafter. Assume that the average inflation rate is 4% and the market interest rate is 11% during this inflationary period. What is the equivalent present worth of this investment?Raysut cement has taken up a new project with an initial investment of 125000 OMR.The expected future cashflow from the project over the next three years will be 57000 OMR, 55000 OMR and 65000 OMR.What is the profitability index if the discount rate is 15 percent? Select one: a. 1.04 b. 1.23 c. 1.12 d. None of these e. 1.07
- A certain amount of money after a decade is said to be worth Php 12,000.00. If the interest rate after the first half of the projected period is 1.8% compounded monthly, and the next half has 1.1% compounded bimonthly, what must have been the principal amount in USD? Assume that there are 365 days in a year and 1 USD = 49 PHP.The present worth of a decreasing geometric series is 96157$. The interest rate is 8% per year and the rate of change is 10% per year. If the cash flow amount in year 1 is 20000 determine the year in which the gradient endsA certain amount of money after a decade is said to be worth Php 10,000.00. IF the interest rate after the first half of the projected period is 1.8% compounded wookly, and the nest half has 2% compounded monthly, what must have been the principal amount in USD? Assume that there are 385 days in a year and 1 USD = 51 PHP at the end of the period, which increased 0.1 PHP after each year.
- Suppose that the current price of oil is $ 90 per bbl. Suppose it costs $ 0.5 per bbl per month to store oil (payable monthly in advance). Suppose also that the term structure is flat with a continuously compounded rate of interest of 3 % for all maturities. Calculate the forward price of oil for delivery in 3 months.An investment of $8,000 is made at time 0 with returns of $3,500 at the end of each of years 1–4, with all monetary amounts being in real dollars. Inflation is running 7% per year over that time. Also, the real rate of return is 15% per year. Determine the present worth of the investment using both real dollars and then-current dollars.Assume that an investment, with a single initial cost of $1,000 and a yield of $50 monthly for 10 years, had a 7% IRR in the 60th month and a 7.2% IRR five months later. The IRR can be 6.8% in the 62nd month. I don't now how to solve this problem can you provide an explanation on how to solve this problem?