the rate of return

Q: What is the annual rate of return on a perpetuity that costs $500,000 and pays $2,000 monthly?

A: Following details are given in the question: Cost of perpetuity = $500000 Monthly payment (cashflow)…

Q: When you retire, you plan to draw $50,000 per year from your retirement accounts, which will be…

A: Here, Annual payment = $50,000 Interest rate = 6% Number of periods = 10 years To Find: PV of…

Q: What is the present value of a perpetuity that pays $3,800 per year if the appropriate interest rate…

A: Given details are : Annual payment = $3800 Interest rate = 5% = 0.05 From these details we need to…

Q: What's the future value of a 7%, 5-year ordinary annuity that pays $300 each year? If this was an…

A: For ordinary annuity, payment takes place at the end of every period and for annuity due, payment…

Q: A family is saving for their child's education. They want to have $80,000 eighteen years from now .…

A:

Q: You have the opportunity to buy a perpetuity that pays $1,000 annually. Your required rate of return…

A: Payments each year = Cash flow = C = $1000 Rate of Interest = r = 13.2% = 0.132

Q: Your father is about to retire, and he wants to buy an annuity that will provide him with $85,000 of…

A: Present Value:  The present value is the value of cash flow stream or the fixed lump sum amount at…

Q: Suppose you put $ 525 a month for retirement into an annuity earning 5.25% compounded monthly. If…

A: An investment decision may involve regular cashflows of equal amount during successive years in…

Q: What's the present value of a perpetuity that pays $250 per year if the appropriate interest rate is…

A: Perpetuity is a type of annuity which has no maturity. Given data; payment = $ 250 interest rate =…

Q: What is the present value of an annuity that pays $200 per month for 10 years if money is worth 5%…

A: Present Value:It is the discounted value of cash flows of different period or sum of future money…

Q: What's the rate of return you would earn if you paid $1,480 for a perpetuity that pays $75 per year?

A: Rate of return is the rate you earn on perpetuity i.e. amount initially paid.

Q: Suppose you save $4,000 per year at the end of each year for 10 years and earn 8.5% interest per…

A: Since you have not mentioned the specific question we will just answer the first question in case…

Q: Suppose that your retirement benefits during your first year of retirement are $60,000 per year…

A: The interest rate is 7%. The pension amount is $60,000 per year for 25 years. For the 1st year, the…

Q: If I would like to have $250,000 in my savings account after making contributions for 30 years, what…

A: Present Value = Monthly Contributions * PVAF ( Monthly Rate, number of Months )

Q: What is the difference between simple interest and compound interest? Suppose you have $500 to…

A: Difference between Simple Interest and Compound interest Simple Interest is the interest that one…

Q: You want to retire in 30 years with $2,500,000 in your retirement account, how much do you need to…

A: Future value required (FV) = $ 2,500,000 Interest rate (r) = 8% Number of annual payments (n) = 30

Q: What is the annual rate of return on a perpetuity that costs $500,000 and pays $1,000 monthly?

A: Following details are given in the question: Cost of perpetuity = $500000 Monthly payment (cashflow)…

Q: You just inherited $10,000. While you plan to squander some of it away, how much should you deposit…

A: The investments or savings in the account are made with an expectation of increment in its value in…

Q: money right now. Find FV Annuity: If you deposit your annual payments into an account earning 2% per…

A: Payments = $10,000 Interest rate = 2% Time period = 10 years

Q: You want to receive $5,000 per month in retirement. If you can earn 0.75% per month and you expect…

A: The present value is the value of the sum received at time 0 or the current period. It is the value…

Q: Suppose you put $ 450 a month for retirement into an annuity earning 4.25% compounded monthly. If…

A: Future value can be referred to as the value of an underlying asset or security at a future date.…

Q: What's the future value of a 5%, 5 year ordinary annuity that pays $800 each year? If this was an…

A: The future value of the annuity is the total value of all the payments which is occurred regularly…

Q: How much money is needed now to establish a perpetuity that pays $2,000 at the end of every quarter…

A: given information   perpetuity that pays at the end of every quarter = $2000 interest rate = 2.5% =…

Q: If you wish to accumulate $25,000 by the end of 5 years, how much would your annual payment be if…

A: The equivalent annual cost is the periodic payment made towards the acquisition of an asset or…

Q: If you would like to have $20,000 in 5 years, how much should you invest today if your investment…

A: Present value is the value today of future cash flows discounted at the required rate of return for…

Q: What is the price of a perpetuity that pays $50 annually and the required rate of return is 6%?

A: In this question we need to compute the price of a perpetuity.

Q: What is the maximum that you would be willing to loan your brother for a $100 IOU if he promises to…

A: Since  Future value = Present value ×(1+Periodic Interest rate)^n Where, N= Number of periods = 1…

Q: Suppose that you save for retirement by contributing the same amount each month from your 23 rd…

A: Monthly saving (pmt) = $100Rate of Return (rate) = 7.5% or 0.075Type of Compounding = MonthlyNumber…

Q: you would earn if you paid $1

A: A perpetuity is a series of uniform cash flows over an indefinite period of time.

Q: Suppose that your retirement benefits during your first year of retirement are $50000. Assume that…

A: The cost of living is defined as the amount of money needed to cover the expenses of day-to-day…

Q: What is the future value of a 5%, 5-year ordinary annuity that pays P8,000 each year? If this was an…

A:

Q: You have just made your first $4,000 contribution to your retirement account. Assuming you earn an 9…

A: a) Computation:

Q: How much will you have in accumulated savings 20 years from now if you deposit $2,000 at the end of…

A: Period = 20 Years Year end deposit = $ 2000 Growth rate = 2% Interest rate = 5%

Q: How much do you need to save each year for 30 years in order to have $775,000, assuming you are…

A: Given information: Future value amount is $775,000 Interest rate is 8% Number of years is 30

Q: If you purchase a $5, 000 perpetuity that pays $200 annually, what rate of return will you earn? (a)…

A: Perpetuity is a stream of identical cash flows with no end. It is a type of payment that is both…

Q: If you deposit 3500 today into an account earning an annual rate of 11% what would your account be…

A: To calculate the amount of account after 40 years by using below formula   Value of account after 40…

Q: If you are considering the purchase of a consol that pays $60 per year forever, and the rate of…

A: PERPETUITY : IT IS ANNUITY WHICH IS PAID FOREVER. PV =ar where, a=annual payment r= rate

Q: If you put up $73,000 today in exchange for an annual 6.75 percent, 18-year annuity, what will the…

A: The annual cash flow can be computed with the help of present value of annuity.

Q: What’s the present valu

A: A perpetuity is a series of uniform cash flows over an indefinite period of time.

Q: You are offered the opportunity to put some money away for retirement. You will receive four annual…

A: The present value is the value of the sum received at time 0 or the current period. It is the value…

Q: Suppose you invest in an annuity that pays 5% interest, compounded semiannually. How much will you…

A: Formula used as follows: S=R1+in-1iS=Future valuei=Interest rate per periodn=Number of…

Q: Suppose you buy a home and finance $255,000 at $2,223.17 per month for 30 years. What is the amount…

A: Given: Finance amount = $255,000 Payment per month = $2,223.17 Years = 30

Q: savings. If the company's MARR is 20% per year, what is Josh's bonus?

A: Information Provided: MARR = 20% Bonus % = 0.1% Net savings per year = $12.5 million

Q: You have just retired with savings of $5 million. If you expect to live for 49 years and to earn 12%…

A: Present value = Annuity * PVAF ( Rate, Years )

Q: What is the rate of return you would earn if you paid $3,680 for a perpetuity that pays $85 per…

A: In this question we require to compute the rate of return on a perpetuity.

Q: Suppose that you borrow ​$11,000 for five years at 5​% toward the purchase of a car. whats the…

A: Given: Amount borrowed = $11,000 Time =5 years or 5*12 =60 periods Rate =5%  or 0.05/12 =0.42%

Q: What's the future value of a 7 percent,  5-year ordinary annuity that pays $300 each year?

A: A theory that helps to compute the present or future value of the cash flows is term as the TVM…

Q: Suppose you put $ 600 a month for retirement into an annuity earning 7.5% compounded monthly. If you…

A: To calculate the number of years, excel NPER function is used.

Types of Insurance Contract

Insurance is a contract wherein an individual or entity gets financial protection from the insurance company for any damages or losses incurred. The individual or entity is called the insured, whereas the insurance company is called the insurer. The insured and the insurer enter a legal contract for a fixed term called the insurance term, and the contract is called an insurance policy.