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Estimate the percentage of an employee's salary that must be contributed to the pension plan if it is to remain solvent.
(a) A lump sum cash payment of $100,000 (b) 10 annual payments of $12,000 each, the first occurring immediately.
Explain to the client the main differences between simple interest versus compound interest.
Remember to consider the investment time frame and investment purpose when setting forth his investment opinion.
a. Calculate the discount rate used by the lender. b. Calculate the effective interest rate (APR) on the loan.
At the end of each year a self-employed person deposits $1,500 in a retirement account that earns 10 percent annually.
Is it worthwhile belonging to the company plan in order to get the company's $500 contribution each year?
Q1. At what interest rates would you prefer project A to B Q2. What is the IRR of each of each project
Calculate the implicit annual rate of interest of the above transactions.
Commencing with the first withdrawal on January 31st 1997, he has withdrawn $117, 572 at the end of each month to pay for his medical expenses.
Suppose you have the 2001 income statement for a firm, along with the 12/31/2000 and 12/31/2001 balance sheets. How would you calculate net capital spending?
What is the no-arbitrage price of the contract described above (i.e., what is the fair value of the contract?)
Explain the concept of time value of money. What are the variables involved, how do they relate, and why is the concept important?
Assume you have a discount rate of 14%, calculate the equal annual deposits that you must make for the next 25 years
At a 10 percent required return, find the net present value, the profitability index, the payback period and present value payback period.
What is the value of one ordinary share of the company?
You want to begin a college fund for your newborn child; you hope to accumulate $ 30,000 by 18 years from now.
What is the future value of $1000 invested today if it earns 10% interest for 1 year? 2 years?
What are the implications for management of each of the following trends: reduction in cost of hardware with time?
What was the average expected inflation rate over the 5 year period 1981-1985? (use arithmetic average)
For the new ultrasound machine, compute the: (a) cash payback period. (b) net present value. (c) annual rate of return.
a) What is the expected value (FV) of his portfolio in ten years? b) What is the expected value (PV) of his social security income in ten years?
A famous quarterback just signed a $15 million contract providing $3 million a year for 5 years.
What are examples of long-term notes payable in our personal finances? Why is unearned revenue considered a liability?
a) Compute the periodic rates of return. b) Compute the arithmetic and geometric rate of return for this stock over the past three years.