What are some reasons why the investment strategy of a 30-year-old might differ from the investment strategy of a 65-year-old?

Q: Which are the Decision Rule for Simple Investments?

A: Answer - Simple Investment - Investment which an individual do into there day to day life like…

Q: Economists assert that financial markets serve the function of efficiently allocating capital. What…

A: The stock market, bond market, currency market, and derivatives market are just a few examples of…

Q: Investment X offers to pay you $5,500 per year for nine years, whereas Investment Y offers to pay…

A: An investment is an asset or item acquired with the goal of generating income or appreciation.…

Q: What's the value to you of a $1,000 face- value bond with an 8% coupon rate when your required rate…

A: A bond is an instrument being issuer to the holders of indebtedness of the bond.

Q: Why would lenders want to see that a business already has some level of capitalization before giving…

A: The banks are the financial institutions who are involved in the process of lending money to the…

Q: Mr. John Dela Cruz, wanted to start investing in the stock market, which of the following financial…

A: In a market, there are different industries and different types of markets for different types of…

Q: At what point in one’s life is it safest to try a risky investment?  Closer to or further from…

A: Its safest to try risky investment when you are further from retirement.

Q: If Charlie invests $50,000 in a cheese company today and is offered a 5% interest rate. How much…

A:

Q: Dennis is planning to invest his money to earn more. He is willing to take a little risk by buying…

A: Dennis is want to buy income earning assets and he is ready to bear less risk . Then following…

Q: What is shares of stocks?

A: A capital market is a marketplace where investors and sellers exchange financial instruments such as…

Q: Your bank account pays an interest rate of 4 percent. You are considering buying a share of stock in…

A: Answer - Given in the question - Interest rate =  4%Price of stock XYZ = $110dividend = $5We have to…

Q: What is Risk-free real return?

A: The gain or loss of an initial investment over a given time period is referred as rate of return.…

Q: What is the Investment-Pool Concept?

A: The income of the individuals, and households is used for various purposes. The income taxes are…

Q: How would you describe the relationship between a risky investment and the return on that investment…

A: Investors are two types one who loves the take risk and one who avoids risk basically they are risk…

Q: What is an investment pool?

A: Investment pools are the funds collected from individual investors or public entities. These funds…

Q: Why might an investor prefer to invest indirectly rather than directly?

A: Direct or indirect investment both leads to pay offs, it depends on the investor about what is…

Q: When you invest your money in the stock Market, the original investment is called the…

A: When an individual earns income by serving as labor or employee, he has two ways to use that income,…

Q: Why is it important for people who own stocks and bonds to diversify their holdings? What type of…

A: System that permits exchange of funds between the borrowers, investors and lenders via the medium of…

Q: Why do most investors hold diversified portfolios?

A: "Don't put all your eggs in one basket" This adage very well captures all the essence of…

Q: Distinguish between Simple investments and Nonsimple Investments?

A: The investments are an important factor for the growth of the economy which cannot grow without the…

Q: What do you mean by capital recovery factor?

A: Capital recovery factor can be explained as the ratio of constant annuity and the annuity's value…

Q: Before investing, what are the factors that should take into considerations in order that the…

A: Draw a private financial roadmap: the primary step to successful investing is determining your goals…

Q: The benefit of diversification when constructing a portfolio is that it can reduce what?

A: Diversification(D) is a strategy to minimize the risk by combining variety of investments(I) within…

Q: If a firm earns $500 million in profits for the year and they retain $175 million, how much do they…

A: Retained earnings are those earnings that are earned by the firm but have not been returned to…

Q: Describe one of the simple method that is commonly used to screen capital investments?

A: The payback method is one of the simple methods used for the screening of capital investment before…

Q: You have two investments to choose from. Investment A pays an interest rate of 5% for 2 years and…

A: Future worth is a worth of a venture or resource on a particular date from now on. To put it another…

Q: if the market interest rate is equal to 5%, should you buy for 900 euros a coupon zero risk free…

A: We are going to find the terminal value in both alternatives to answer this question.

Q: Your bank account pays an interest rate of 8 percent. You are considering buying a share of stock in…

A: The interest rate is the amount a lender charges a borrower and is a percentage of the principal the…

Q: Why do we use the present value of an asset or investment as basis for its value?

A: Present Value:- Amounts of money presently are valued higher than the same quantity in the future,…

Q: Calculate the value of profits if corporate tax is $200 million, dividend is $60 million and…

A: The information being given to us is as follows:- Corporate tax = $200 million Dividend = $60…

Q: A Government issues a bond that pays 1000$ in 1 year. If the price of the bond is 920$, what is the…

A: Here, it is given that the government is paying an amount of $1000 for a bond, whose price is $920.

Q: How is a firm's net income important?

A: Net income is earned by the company or individual after deducting expenses and taxes. It is also…

Q: What is the meaning of Net Present Worth?

A: The net present worth also known as the net present value calculated the difference between the…

Q: True or false: Investors and lenders are the same group of people

A: The concept that depicts the allocation of money with the primary motive of having a benefit from it…

Q: A company has an investment project that would cost $10 million today and yield a payoff of $15…

A: Given: Initial investment = $10,000,000, Future Value (FV) = $15,000,000, time (t) = 4 years The…

Q: Define Purchase of Investment.

A: An investment is the purchase of products, the main purpose for which is to have gains. They are not…

Q: How much liability does stockholder assume?

A: Shareholder: Any person, company, or organization holding stock in a specific company.

Q: Explain Return on Invested Capital?

A: Return on Invested Capital (ROIC) is a profitability or performance ratio which aims to measure a…

Q: From the investor's point of view, how is the rate of return on common equity a good indicator?

A: The rate of return is the yield on the investment or interest rate it gets from investing its money.…

Q: Which factors affect the yield to maturity (or return on investment?

A: Yield to Maturity provides a benchmark for evaluation of different types of investment instruments.