If you are able to save Php 5 000 in year 1, Php 5150 in year 2 , and amounts increasing by 3 % each year through year 10, the amount you will have at the end of year 10 at 12 % per year interest is closest to: a. Php 63 525.80 b. Php 97 885.10 c. Php 82 714 .55 d. Php 78 755.32

If you are able to save Php 5 000 in year 1, Php 5150 in year 2 , and amounts increasing by 3 % each year through year 10, the amount you will have at the end of year 10 at 12 % per year interest is closest to: a. Php 63 525.80 b. Php 97 885.10 c. Php 82 714 .55 d. Php 78 755.32

Cornerstones of Cost Management (Cornerstones Series)

4th Edition

ISBN:9781305970663

Author:Don R. Hansen, Maryanne M. Mowen

Publisher:Don R. Hansen, Maryanne M. Mowen

Chapter19: Capital Investment

Section: Chapter Questions

Problem 19E

See similar textbooks

Related questions

Q: 3. “Cooped up at home by stay-at-home orders during the anxious early days of the pandemic, many…

A: Day trading is a type of trading where an individual buys and sells financial instruments, such as…

Q: 1. The market price for Alphabet Soup's 7.5% bonds maturing in 10 years are selling for $1,013.03.…

A: A bond is a debt instrument that provides the issuing company with the capital from investors…

Q: If the Local employment sector of manufacturing is 40,125 and total local total employment is…

A: If the Local employment sector of manufacturing is 40,125 and total local total employment is…

Q: A bank has made a $10 million loan with no prepayment penalties at a rate of T-Bill (3-month) +…

A: Risk refers to an amount of uncertainty that can arise from the inherent losses from the decision…

Q: You have just purchased a new warehouse. To finance the purchase, you've arranged for a 30-year…

A: Here, Purchase Price of Loan is $2,600,000 Monthly Payment is $16,700 Loan Amount is 80% Time Period…

Q: You would expect a bond of an Eastern European government to pay a higher interest rate as compared…

A: Bonds are fixed-income assets that serve as a representation of investor loans to borrowers…

Q: B Constant Dividend Growth Valuation Woldtke Manufacturing's stock currently sells for $16 a share.…

A: Step 1 The Gordon Growth Model (GGM) is a method used to estimate a stock's intrinsic value based on…

Q: When you find that the gross profit is doing ok, the same with the EBIT but the NPBT is not…

A: EBIT stands for earnings before interest and taxes. NPBT stands for net profit before taxes. These…

Q: in its first 10 years a mutual fund produced an average annual return of 21.63%. Assume that money…

A: Compounding is the method of interest accumulation where interest is earned not only on the…

Q: Capital budgeting analysis is based on

A: Capital budgeting is the process of analyzing and evaluating potential investment opportunities to…

Q: Last year Carson Industries issued a 10-year, 14% semiannual coupon bond at its par value of $1,000.…

A: Step 1 The annual coupon on a bond is shown as a percentage of the market price, which may be more…

Q: Andrew Thomas, a sandwich vendor at Hard Rock Cafe's annual Rockfest, created a table of conditional…

A: EVPI can be a useful tool for decision-makers who want to evaluate the potential benefits of…

Q: Suppose you are a small business owner and are considering investing in a new project that has an…

Q: Phil graduates in 3.5 years and wants to buy a new car then. How much should he save now to have…

A: Present Value (PV) refers to the current value of a future sum of money, discounted at a specific…

Q: You want to create a college fund for a child who is now 4 years old. The fund should grow to…

A: The lumpsum amount to be deposited is the present value of the future funds needed. This is the…

Q: Stock FM has a standard deviation of 24.7 percent and a correlation coefficient of 0.57 with market…

A: Standard deviation of stock = 24.7% Correlation coefficient = 0.57 Standard deviation of market…

Q: You are a manager in a company and have been noticing that the Cash Conversion Cycle is a problem.…

A: The Cash Conversion Cycle (CCC) measures the time it takes for a company to convert its investments…

Q: A single stock, A has a variance of 0.006 and a covariance with the market portfolio given by 0.013.…

Q: Based on the following cashflows, what is my IRR? YR 0 1 23 4 ($129,000) ($12,000) $10,000 $27,500…

A: Internal rate of return (IRR) is a financial metric used to measure the profitability of an…

Q: What is the maturity value of $1500 invested at 6.75% for a period from 145 days 1540.22 2153.08…

A: Simple interest is computed only on the original principal amount as a simple percentage of the…

Q: i bought a painting for $5000. it is expected to appreciate at a rate of 4%. how much will it be…

A: In order to understand the appreciation on the assets it is important considered that the operations…

Q: SKIG Ltd, a construction company, is considering the selection of one from two mutually exclusive…

A: Capital budgeting refers to the process of evaluating and selecting long-term investment projects…

Q: 4. What is the present value (PV) of a 12-year lease arrangement with an interest rate of 7.5% that…

A: The PV of an investment refers to the value of its cash flows after they have been discounted at an…

Q: Consider an example. Assume a share of preferred stock with the following characteristics:…

A: Only the first question will be answered. Preference stock are shares of a company's stock with…

Q: AB builders has 15 year bonds outstanding with a face value of $1,000 and a market price of $974.…

A: Time = t = 15 years Face value = fv = $1000 Bond price = p = $974 Yield to maturity = r = 4.03%…

Q: A 40-year-old woman decides to put funds into a retirement plan. She can save $3,000 a year and earn…

A: The concept of time value of money will be used here. As per the concept of time value of money the…

Q: An investor is purchasing an industrial building. He needs to replace the roof today at a cost of…

A: Future value is the value of an investment or asset at a specified date in the future, based on the…

Q: Description A system in which exchange rates are held constant A system in which exchange rates are…

A: In the context of foreign exchange market exchange rate is the rate at which currency of one country…

Q: Just suppose your won a lottery of $1,000,000 and you have the option to receive it today or in 2…

A: Step 1 The value of a sum of money today is known as its present value.

Q: Which of the following statements is false about the dividend irrelevance proposition of Modigliani…

A: According to Modigliani and Miller, if dividend policy and investment decisions are unrelated, then…

Q: You've decided that index put options are attractive to sell. For simplicity, assume the current…

A: As per the given information: S&P500 index level = 100Risk-free rate = 1%S&P500 index…

Q: Sandhill Corp. management is planning to convert an existing warehouse into a new plant that will…

A: The IRR is the investment discount rate that corresponds to the difference between the original…

Q: You took a long position on the Micro WTI Crude Oil futures (MCL) when value of the futures was 71…

A: Futures contract is a legal agreement to buy or sell a specified asset at a predetermined price at…

Q: Madsen Motors's bonds have 14 years remaining to maturity. Interest is paid annually, they have a…

A: A bond is a debt security, which represents a loan made by an investor to a borrower, usually a…

Q: Interest rates on 4-year Treasury securities are currently 6.9%, while 6-year Treasury securities…

Q: 1. Paulo won the lottery. He is offered a series of payments $100,000 per year for 10 years. What is…

A: The concept of money's time worth reveals that any sum currently is worth more as compared to the…

Q: A $1,000 par value bond was issued 30 years ago at a 12 percent coupon rate. It currently has 25…

A: A bond is a type of debt security that is issued by the corporations of business enterprises in…

Q: Set up expressions initially with functional notation like P/F,i,n 1. The owner of small business…

A: Here, Amount Borrowed is $40,000 Interest Rate is 5% Annual Instalments is $21,512.20 To calculate…

Q: You are considering making a movie. The movie is expected to cost $10.1 million up front and take a…

A: Net present value shows the change in the net cash inflows and outflows during the period. It is…

Q: Terminal cash flow: Replacement decision Russell Industries is considering replacing a fully…

A: After-tax proceeds from sale of new asset: Proceeds from sale of new machine 75000…

Q: Assume you have a one-year investment horizon and are trying to choose among three bonds. All have…

A: The price of a bond moves inversely with its YTM. When the YTM increases, the bond price falls and…

Q: On January 1, 20x1, Entity A acquires all the assets and liabilities of Entity B for P2,000,000.…

A: Working Note #1 Computation of consideration transferred: Consideration transferred=P2,000,000 -Off…

Q: General Computers Inc. purchased a computer server for $58,500. It paid 40.00% of the value as a…

A: Step 1 An amortized bond is one in which, during the course of the bond's existence, both the…

Q: Which of the following is not true? GAP analysis Ignores changes in the market value of…

A: GAP analysis, also known as interest rate gap analysis, is a method of measuring and managing…

Q: Replacement decides versus expansion cash flows Tesla Systems has estimated the cash flows over the…

A: In a replacement project, incremental cash flow refers to the difference in cash flows between the…

Q: A "spider" refers to: a limited partnership that invests in coal mines. an…

A: Spider is used to describe the Standard & Poor's Depository Receipt (SPDR). This type of…

Q: Assume that a share of stock has just paid an annual dividend of $3.00 (Do), and that this dividend…

A: Banko growth model-Under this model, dividend increase by the same dollar amount in each year.…

Q: In an effort to save money for early retirement, an environmental engineering colleague plans to…

A: Future value refers to the value of a current asset at some future date affected by inflation and…

Q: Interest rates on 4-year Treasury securities are currently 6.6%, while 6-year Treasury securities…

A: A treasury is a type of bond issued by the government to raise funds from the public for a specific…

Question

a. Php 63 525.80

b. Php 97 885.10

c. Php 82 714 .55

d. Php 78 755.32

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

SEE SOLUTION Check out a sample Q&A here

Formula for the future value of an annuity

VIEW

Calculation of payment or savings for each year

VIEW

Calculation of Future Value

VIEW

Answer

VIEW

Step by step

Solved in 4 steps

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, finance and related others by exploring similar questions and additional content below.

Similar questions

How much would you invest today in order to receive $30,000 in each of the following (for further instructions on present value in Excel, see Appendix C): A. 20 years at 22% B. 12 years at 10% C. 5 years at 14% D. 2 years at 7%
If you invest $15,000 today, how much will you have in (for further instructions on future value in Excel, see Appendix C): A. 20 years at 22% B. 12 years at 10% C. 5 years at 14% D. 2 years at 7%
If you invest $12,000 today, how much will you have in (for further Instructions on future value in Excel, see Appendix C): A. 10 years at 9% B. 8 years at 12% C. 14 years at l5% D. 19 years at 18%
You put $600 in the bank for 3 years at 15%. A. If Interest Is added at the end of the year, how much will you have in the bank after one year? Calculate the amount you will have in the bank at the end of year two and continue to calculate all the way to the end of the third year. B. Use the future value of $1 table In Appendix B and verify that your answer is correct.
How much must be invested now to receive $50,000 for 8 years if the first $50,000 is received in one year and the rate is 10%?
Project A costs $5,000 and will generate annual after-tax net cash inflows of $1,800 for five years. What is the NPV using 8% as the discount rate?
You put $250 in the bank for S years at 12%. A. If interest is added at the end of the year, how much will you have in the bank after one year? Calculate the amount you will have in the bank at the end of year two and continue to calculate all the way to the end of the fifth year. B. Use the future value of $1 table in Appendix B and verity that your answer is correct.
Conestoga Plumbing plans to invest in a new pump that is anticipated to provide annual savings for 10 years of $50,000. The pump can be sold at the end of the period for $100,000. What is the present value of the investment in the pump at a 9% interest rate given that savings are realized at year end?
An investment of 1,000 produces a net cash inflow of 500 in the first year and 750 in the second year. What is the payback period? a. 1.67 years b. 0.50 year c. 2.00 years d. 1.20 years e. Cannot be determined
Project B cost $5,000 and will generate after-tax net cash inflows of $500 in year one, $1,200 in year two, $2,000 in year three. $2,500 in year four, and $2,000 in year five. What is the NPV using 8% as the discount rate? For further instructions on net present value in Excel, see Appendix C.
Refer to the present value table information on the previous page. What amount should Brett have in his bank account today, before withdrawal, if he needs 2,000 each year for 4 years, with the first withdrawal to be made today and each subsequent withdrawal at 1-year intervals? (Brett is to have exactly a zero balance in his bank account after the fourth withdrawal.) a. 2,000 + (2,000 0.926) + (2,000 0. 857) + (2,000 0.794) b. 2,0000.7354 c. (2,000 0.926) + (2,000 0.857) + (2,000 0.794) + (2,000 0.735) d. 2,0000.9264