9 _0 A 2 Answer 3 4 Bayandor Steel Corp invested $560,000 in a new torch for one of its smelters. At an interest rate of 6% per year, compounded semiannually, what is the minimum 5 semiannual electricity savings required to recover this investment in 10 years? 6 7 Draw CFD, and Enter the Answer in 'B2' Cell above. 8 1 _2 3 _4 4567 B 7 e E LL F G H K Effective annual interest rate m ia = = (1 + )" - 1 r = nominal interest rate per interest period (usually one year) i = effective interest rate per interest period m = number of compounding subperiods per time period M

9 _0 A 2 Answer 3 4 Bayandor Steel Corp invested $560,000 in a new torch for one of its smelters. At an interest rate of 6% per year, compounded semiannually, what is the minimum 5 semiannual electricity savings required to recover this investment in 10 years? 6 7 Draw CFD, and Enter the Answer in 'B2' Cell above. 8 1 _2 3 _4 4567 B 7 e E LL F G H K Effective annual interest rate m ia = = (1 + )" - 1 r = nominal interest rate per interest period (usually one year) i = effective interest rate per interest period m = number of compounding subperiods per time period M

Essentials Of Investments

11th Edition

ISBN:9781260013924

Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Chapter1: Investments: Background And Issues

Section: Chapter Questions

Problem 1PS

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QS 11-17 (Algo) Net present value of annuity and salvage value LO P3 Pablo Company is considering buying a machine that will yield income of $3,100 and net cash flow of $14,700 per year for three years. The machine costs $45,900 and has an estimated $11,100 salvage value. Pablo requires a 10% return on its investments. Compute the net present value of this investment. (PV of $1, FV of $1, PVA of $1, and FVA of $1) (Use appropriate factor(s) from the tables provided. Negative amounts should be indicated by a minus sign. Round your present value factor to 4 decimals.) Years 1-3 Year 3 salvage Totals [Initial investment Net present value Net Cash Flows X PV Factor 14,700 x 11,100 x $ S = = Present Value of Net Cash Flows $ 0 0
Problem 25-7 (LG 25-4) Assume an Fl originates a pool of short-term real estate loans worth $39 million with maturities of five years and paying interest rates of 7 percent (paid annually). The loans are amortized. a. What is the average payment received by the FI (both principal and interest) if no prepayment is expected over the life of the loans? b. If the loans are converted into real estate certificates and the Fl charges a 150 basis points servicing fee (including insurance), what are the payments expected by the holders of the securities, if no prepayment is expected? (For all requirements, enter your answers in dollars not in millions. Do not round intermediate calculations. Round your answers to the nearest dollar amount.) × Answer is complete but not entirely correct. Average payment $ 9,511,737 b. Average payment $ 9,369,061 (X)
2 10 points & 01:46:23 eBook Hint Bartlett Car Wash Company is considering the purchase of a new facility. It would allow Bartlett to increase its net income by $91,438 per year. Other information about this proposed project follows: Initial investment Useful life Salvage value $ 427,280 8 years $ 52,000 Assume straight line depreciation method is used. Required: 1. Calculate the accounting rate of return for Bartlett. Note: Round your percentage answer to 2 decimal places. 2. Calculate the payback period for Bartlett. Note: Round your answer to 2 decimal places. 1. Accounting Rate of Return Print 2. Payback Period References % years
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PROBLEM 10 A developer deposits $84,720 for 7 months and earns $4055.46 in simple interest.Find the interest rate.
A B C D E F G H J K L M N 2 PROBLEM (1-4) 3 4 5 (A) If you want to have $250 in 5 years and you can earn an annual return of 7%, how much must you invest today? Be sure to use cell references and make sure that your answer appears as a positive value. 6 (B) If you make a one-time deposit today of $800 you can earn 10% per year, how much would you have in your account after 15 years? Be sure to use cell references and remember that 7 deposits from you are outflows. 8 9 (C) If your investment of $1,254 declined to $435 in 6 years, what compounded annual rate of return would you have earned? Be sure to use cell references and to convert your answer to a percent rounded to two places after the decimal point. 10 (D) If you can earn 5% per year, precisely how many years would it take for your investment of $450 to turn into $1,200? Be sure to use cell references and display your answer rounded 11 to two places after the decimal point. 12 13 TIME VALUE OF MONEY: LUMP SUMS 14 15 (A) (B) (C)…
1 WN 2 3 You want to buy a new sports coupe for $84,500, and the finance office at the dealership has quoted you an APR of 4.7 percent for a 60-month loan to buy the car. What will your monthly payments be? What is the effective annual rate on this loan? 4 5 6 Cost of car 7 APR 8 Number of months 9 Compounding periods per year 10 11 (Use cells A6 to B9 from the given information to complete this question. Your payment should be a positive value.) 12 Input area: 13 Output area: 14 15 Payment 16 Effective interest rate 17 18 $84,500 4.70% 60 12

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