A) B) C) J D) K M N C G H Assume a hypothetical age. Assume you drink one coffee per day, 5 days a week. Assume the coffee price is $4.00. 1. That makes it $20 per week and $80 per month. Assume you can invest $80 per month in the stock market and assume you can cam 11 % per year compouded monthly on your stock investment. O P Q R S T U V W X Y 2 What is your assumed age to the closest month? Your assumption must have a month, for example, 22 years is not acceptable since it does not have a month but 22 years and one month are acceptable. So, choose an age that has 1 to 11 months At your retirement, when you are 68 years old, how much will the total amount of money be if you switch from coffee drinking to investing in the stock market? Assume that when you get to 68 (retirement age) you switch your funds from stock market investment to bond market investment. Assume you can curn 7.5% on your bond investment. You decide to withdraw a constant amount each year for the next 20 years when you get to retirement age How much will be your annual withdrawal from age 69 to 88 (Nothing left at 88, 20 years of withdrawals) if you switch your coffee drinking to stock and bond investments? If you aim to have one million in your retirement account when you get to age 68, how much you must invest in the stock market per month if the stock market monthly average retum is 0.83 %?
A) B) C) J D) K M N C G H Assume a hypothetical age. Assume you drink one coffee per day, 5 days a week. Assume the coffee price is $4.00. 1. That makes it $20 per week and $80 per month. Assume you can invest $80 per month in the stock market and assume you can cam 11 % per year compouded monthly on your stock investment. O P Q R S T U V W X Y 2 What is your assumed age to the closest month? Your assumption must have a month, for example, 22 years is not acceptable since it does not have a month but 22 years and one month are acceptable. So, choose an age that has 1 to 11 months At your retirement, when you are 68 years old, how much will the total amount of money be if you switch from coffee drinking to investing in the stock market? Assume that when you get to 68 (retirement age) you switch your funds from stock market investment to bond market investment. Assume you can curn 7.5% on your bond investment. You decide to withdraw a constant amount each year for the next 20 years when you get to retirement age How much will be your annual withdrawal from age 69 to 88 (Nothing left at 88, 20 years of withdrawals) if you switch your coffee drinking to stock and bond investments? If you aim to have one million in your retirement account when you get to age 68, how much you must invest in the stock market per month if the stock market monthly average retum is 0.83 %?
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
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Dividend Valuation
Dividend refers to a reward or cash that a company gives to its shareholders out of the profits. Dividends can be issued in various forms such as cash payment, stocks, or in any other form as per the company norms. It is usually a part of the profit that the company shares with its shareholders.
Dividend Discount Model
Dividend payments are generally paid to investors or shareholders of a company when the company earns profit for the year, thus representing growth. The dividend discount model is an important method used to forecast the price of a company’s stock. It is based on the computation methodology that the present value of all its future dividends is equivalent to the value of the company.
Capital Gains Yield
It may be referred to as the earnings generated on an investment over a particular period of time. It is generally expressed as a percentage and includes some dividends or interest earned by holding a particular security. Cases, where it is higher normally, indicate the higher income and lower risk. It is mostly computed on an annual basis and is different from the total return on investment. In case it becomes too high, indicates that either the stock prices are going down or the company is paying higher dividends.
Stock Valuation
In simple words, stock valuation is a tool to calculate the current price, or value, of a company. It is used to not only calculate the value of the company but help an investor decide if they want to buy, sell or hold a company's stocks.
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Assume a hypothetical age. Assume you drink one coffee per day, 5 days a week. Assume the coffee price is $4.00.
1. That makes it $20 per week and $80 per month. Assume you can invest $80 per month in the stock market and assume you can cam 11% per year compouded monthly on your stock investment.
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What is your holding period retum both in dollars and in percentage?
What is your Effective Annual Retum in percentage?
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What is your assumed age to the closest month? Your assumption must have a month, for example, 22 years is not acceptable since it does not have a month but 22 years and one month are acceptable. So, choose an age that has 1 to 11 months
At your retirement, when you are 68 years old, how much will the total amount of money be if you switch from coffee drinking to investing in the stock market?
Assume that when you get to 68 (retirement age) you switch your funds from stock market investment to bond market investment. Assume you can earn 7.5% on your bond investment. You decide to withdraw a constant amount each year for the next 20 years when you get to retirement age
How much will be your annual withdrawal from age 69 to 88 (Nothing left at 88, 20 years of withdrawals) if you switch your coffee drinking to stock and bond investments?
If you aim to have one million in your retirement account when you get to age 68, how much you must invest in the stock market per month if the stock market monthly average retum is 0.83 %?
Assume you bought a stock at $60 and 4 months later, you sold it for $80 dollars. Assume no dividends and no transaction commission costs
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