Investment Problem ost of bldg.. -5M ross Revenue = 9.5 M perating expense = 4M ominal interest rate = 12% ngoing inflation rate = 8% ) How much is the total profit?
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- Interest RatesSuppose that you make a loan of $1,500 to your friend at a rate of 10% interest because you expect the inflation rate to be 5%.a) By how much does your purchasing power increase once the loan is completely paid off?b) Assuming that after the loan was repaid, you discovered that inflation rate over the life of the loan was only 2%. Who gained?If VIF- variance inflation factor is 1.25 what does it suggest when price is a function of income Is multicollinearity an issue here?The real risk-free rate is 4%. Inflation is expected to be 3% this year, 4% next year, and then 3% thereafter. The maturity risk premium is estimated to be 0.0003 x (t - 1), where t = number of years to maturity. What is the nominal interest rate on a 7-year Treasury security? Do not round intermediate calculations. Round your answer to two decimal places.
- 6. Assume that the inflation rate will be 4% for all future years, and the interest rate is 7%. How many years will it take for the dollar to have the purchasing power that is equal to 65% of itscurrent purchasing power? (select the closest answer)a) about 7 yearsb) about 11 yearsc)about 18 yearsd) about 20 years1. you are earning 7% annually and contributing the max allowable each year: if you want to have at least $1,000,000 in your IRA by age 60, what is the latest age you can start investing? b. Suppose you invest $3,000 and earn 7% interest per year on this investment. How many years will it take for your total investment to be worth $6,000 c. imagine the interest rate on your savings account was 0.5% per year and inflation was 2% per year. After one year, your ability to buy something with the money in this account with be: Question options: more than today less than today exactly the same impossible to sayAssume you make $140,000 a year. The rate of inflation in the last year was 15%. What would your salary need to be in order to compensate for inflation? Question 28 options: a) $161,000 b) $169,000 c) $155,000 d) $145,000
- pls ans as soon as possible The average rate of inflation since 1970 until 2018 is 3.87%. In 1970, a gallon of gas could be bought for $0.25. Today a gallon of gas can be bought for $2.21. Has the cost of gas risen faster or slower than the rate of inflation?If the real interest rate is 11% and the rate of inflation is 3%, then if a firm can invest in a piece of machinery of $7,500 that will provide a profit stream of $3,000 per year for the next 3 years, what should the firm do? A. Invest in the machine b. Do not invest in the machine.. 3.csonsider the following IS-IR-PC m = 99 - 0.2*r r = 3 pi = pi^e + 0.17*(Y-Y*) where Y* = 100 and pi^e = 1. Find the equilibrium inflation rate. (State your answer to 2 decimal places.)
- 7. Using you answer for Question 2, what will be the price per MMBtu of natural gas on June 30,2022 if this average inflation rate continues for the next 60 days (a total of 180 days from December 31,2021)? The nearest answer is:a. $8 b. $9 c. $10 d. $11 e. $12 Answer for 2 was 0.5%4 - According to the data announced in June, which of the following is consumer inflation compared to the same month of the previous year?A) 14.03%B) 16.59%C) 12.04%D) 14.13%E) 0.89%There is a 1-year loan of $15,000. Both parties agree on a 6% of rental price of the money on the loan. Both anticipate a 8% inflation rate for the year. How much is the purchasing power loss on principal? How much is the purchasing power loss on interest?