Question (1): Mark "True" for the correct phrases and "False" for the incorrect phrases * True False The interest rate of %12 Compounded quarterly means that the interest rate is 3% per each 3 months As long as the
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A:
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A: The formula for compound interest A = P(1+r/n)nt A= 7000 r= 5.5% = 0.055 n= 365 as it is compounded…
Q: Tito Ricky borrowed P 500,000 at an interest rate of 12% compounded monthly. Monthly payments of P…
A: In economics, present value refers to the current value of a future stream of cash flow. Future…
Q: If the nominal rate is 16.5% per year compounded quarterly, what is the equivalent effective rate of…
A: according to guidelines we will solve only 3 subparts , for further subparts please post separate
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Q: A present loan of P12,000 is to repaid by equal payments every 6 months over the next 8 years. If…
A: *Present value of the loan = P12000 *Loan payment semi-annually *Time = 8 years Interest rate = 7%
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A:
Q: Suppose that a man lends P50,000 for four years at 12% per year simple interest. At the end of the…
A: Given that, Initial money (p) = 50,000 Time period (n) = 4 years Simple interest rate (r) = 12%
Q: (a) semiannual period, (b) year, (c) 2 years.
A: Nominal interest rate is the interest rate in will the complete affect of the compounding over small…
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A: The inflow or outflow of cash into or out of a firm is referred to as cash flow. It indicates that…
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A: Given information, Present value: P1,000 (6 years from now) Interest rate: 15% Time period: 4 years…
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A: Future worth can be calculated as follows: F=P1+in3P=P1+0.6n3=1.06n
Q: Please provide a complete solution. Thank you! Find the present value, in pesos, given annual…
A: Answer is given below
Q: Assume you borrow $2,000 now at 7% per year for 10 years and you must repay the loan in equal yearly…
A: Given: Present value (PV)=$ 2000 Number of years (n)=10 Interest rate (r)=7%
Q: Suppose you deposited $5,000 in a bank account that pays 5.25% with daily compounding based on a…
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A: Compound interest, also known as Interest on Interest, is interest that is added to the interest…
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A: Given: Annual interest rate = 7% Interest is compounded semi-annually. Hence, i (rate per period) =…
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A: *SOLUTION :-
Q: A debt of "x" pesos with interest rate of 7% compounded annually will be retired at the end of 10…
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Q: The ABC Company has contracted to make the following payments: 500,000 immediately; 50,000 at the…
A: First Cost = 500000 at end of year 1 = 50,000 at end of year 2 = 75,000 at end of year 3 = 100,000…
Q: What is the present value of P500,000 to be received 20 years from now, if the principal is invested…
A: P=A(1+R)nwhere P is present value A is future value R is interest rate n is time period
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Q: You borrowed money today to be paid in 8 equal payments at the end of 8 quarters. If the interest…
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Q: An individual is borrowing P100, 000 at 8% interest compounded annually. The loan is to be repaid in…
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Q: A couple borrowed from a lending company an amount of P 4,000 for 6 years at 12%. At the end of 6…
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A: We are going to find the Present Value of deferred annuity to answer this question.
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Q: How much money today is equivalent to $10,000 in 12 years, with interest at 10% compounded annually?
A: The present value is the value of future sum of money at the given interest rate.
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Q: Six hundred pesos is deposited each year into a savings account that pays 6 % compounded…
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- a) Suppose you put $350 into a bank account today. Interest is paid annually and the annual interest rate is 6 percent. What is the future value of the $350 after 4 years? b) Suppose you are deciding whether to buy a particular bond from your local municipality. If you buy the bond and hold it for 4 years, then at that time you will receive a payment of $10,000. Assume the interest rateis6percent. Underwhatcircumstanceswillyoubuythebond?Meaninguptowhatpriceareyou willing to pay.Economics In 54 months time you expect a cash flow of $3 million. Calculate it’s present value (PV) given the 54-month interest rate is currently 4%, with a volatility of 120 basis points (bps). Explain, using equations with properly-defined mathematical notation, how to map this cash flow to vertices at 4 years and 5 years, in such a way that the volatility of the present value of the mapped cash flow remains at 120 bps. Suppose the 4-year rate has a volatility of 110 bps and the 5-year rate has a volatility of 150 bps, and their correlation is 0.9. How much should be mapped to each vertex. Give your answer in PV terms and round your answers to whole $ values.Define the following: i) Simple interest. ii) Breakeven point. iii) Ordinary annuity. b) When the price of a commodity is Sh. 530 the unit demand is 55 units. The demand is 120 units when the price is Sh. 270. If the cost of production is C = 2q + 150, Calculate the profit when 5 units are produced and sold. c) The present value of an annuity due is Sh. 284,000 after 4 years at a discount rate of 10%. Calculate the annual payment. d) A man deposits Sh. 12,000 in a bank at the beginning of each year. The compound interest is 12% per year. Calculate how long it will take for an accumulated amount of Sh. 95,000.
- can you help me with this qustion Gina deposits her inheritance into an account earning interest of 4% compounded annually. She will notwithdraw the money until the balance has doubled. How long will Gina have to leave the money in theaccountQ) arrow_forward Question Asked Aug 4, 2020 1 views Q) Maria purchases a new big screen television for $850 on her VISA card that carries a favorable interest rate of 8.9% on new charges. a)Determine how long it would take her to pay the television off if she plans on making monthly payments of: $50 $75 and $100 b)compute the total amount that the television cost her with each of the different monthly payments. C) Compute how much money she saved overall by making the $100 payment over the $50 payment. Solve all three subparts plz I upvoteJohnson Controls spent more than $2.5 millionretrofitting a government complex and installing acomputerized energy-management system for theState of Massachusetts. As a result, the state’s energybill dropped from an average of $6 million a yearto $3.5 million. Moreover, both parties will benefitfrom the 10-year life of the contract. Johnson recovers half the money it saved in reduced utility costs(about $1.2 million a year over 10 years); Massachusetts has more money to spend on other things. Whatis the rate of return realized by Johnson Controls inthis energy-control system?
- Lewis’s management has been considering movingto a new downtown location, and they are concerned that these plans may come to fruition priorto the equipment lease’s expiration. If the moveoccurs then Lewis would buy or lease an entirelynew set of equipment, so management wouldlike to include a cancellation clause in the leasecontract. What effect would such a clause haveon the riskiness of the lease from Lewis’s standpoint? From the lessor’s standpoint? If you werethe lessor, would you insist on changing any ofthe other lease terms if a cancellation clause wereadded? Should the cancellation clause containprovisions similar to call premiums or any restrictive covenants and/or penalties of the type contained in bond indentures? Explain your answer.▼ Cash Flow Present Discounted Value Interest Rate is based on the notion that a dollar paid in the future is less valuable than a dollar paid today. Part 2 The present value of a loan in which $3000 is to be paid out a year from today with the interest rate equal to 3% is $enter your response here. (Round your response to the neareast two decimal place) Part 3 If a loan is paid after two years, and the amount $3000 is to be paid then with a corresponding 1% interest rate, the present value of the loan is $enter your response here. (Round your response to the neareast two decimal place)Problem 2 Suppose you purchased a house and took a 30 -year mortgage. The mortgage is unusual: you pay yearly, not monthly. The yearly payment is$17,000and the interest rate is4.2%. What is the amount of mortgage you took? (Round to two decimals.) Hint: find the PV of all the payments.
- 1. If money has a time value, what do you think is the imoact of doing nothing with it (money)?\ 2. For investment decisions, would you recommend the payback period? why or why not?1. How much is the total value of all these presents worth today?2. How much is the future value of all these presents at the end of 12 years?3. If Tita Rhea agrees to give her these amounts annually forever, how much is its total value worth today?4. If the presents are each made continuously throughout the year at a rate of P, multiply the present value in #7 by a suitable adjustment factor (d/δ) to determine its total present value. Type the resulting amount below.Compare the interest earned by $15,000 forten years at 8% simple interest with that earned bythe same amount for ten years at 8% compoundedannually.
