Five years ago, an alumnus of a university donated $50,000 to establish a permanent endowment for scholarships. The first scholarships were awarded 1 year after the contribution. If the amount awarded each year, that is, the interest on the endowment, is $4500, the rate of return earned on the fund is closest to: (a) 7.5% per year (b) 8.5% per year (c) 9% per year (d) 10% per year

Q: An alumni of Jamia Millia Islamia wanted to set up an endowment fund that would award scholarships…

A: Formula:  Capitalised cost(CW) =Annual cost + (Annual cost / interest rate).

Q: Q7: The costs of fuel for a smelting operation are expected to be $50,000 in year three, $52,500 in…

A: Certainly! Let's break down the calculation of the present worth (PW) for the fuel cost, considering…

Q: Professional engineers require that $5000 per year be placed into a sinking fund account to cover…

A: Future Value is given as

Q: What is the rate of return on the increment of investment between the two? (b) Which process. should…

A: The incremental internal rate of return (IRR) is an analysis of the financial return to an investor…

Q: Bid 1: 9% per year, compounded quarterly Bid 2: 3% per quarter, compounded quarterly Bid 3: 8.8% per…

A: When compounding effects are considered, the real return on a savings account or other…

Q: 3. An engineer deposits $8000 in year 1, $8500 in year 2, and amounts increasing by $500 per year…

A: Present value (PV) is a financial concept that represents the current worth of a future sum of…

Q: Emerson Processing borrowed $900,000 for in- stalling energy-efficient lighting and safety equipment…

A: here we can calculate the folowing terms as follow

Q: At 14% per year, A for years 1 through 6 of the cash flows shown below is closest to: (a) $300 (b)…

A: In the given cash flow diagram, there is a uniform gradient series. The cash flow in the first year…

Q: What is the amount of capital that earns simple interest: a)$1,500 at 18% per year in 10…

A: In the market, the amount of capital is also known as principal amount that is invested today to…

Q: Because market interest rates were near all-time lows at 1.25% per year, a hand tool company decided…

A: An interest rate is the amount of interest due per period, as a proportion of the amount lent,…

Q: What is the amount of capital that earns simple interest: a) $1500 at 18% per year in 10 months?…

A: In the market, the amount of capital is also known as principal amount that is invested today to…

Q: A single deposit of $25,000 was made by your grandparents on the day you were born 25 years ago. The…

A: The future compounded amount is calculated using the following formula: A = P(1+i)n, where "P"…

Q: A company has invested 2 million dollars 4 years ago in high yield junk bonds. if the bonds are now…

A: Given: Amount invested=$2 million  Present value of bonds=$2.8 million Time=4 years To find: Rate of…

Q: Construct a cash flow diagram to find the present worth in year 0 of a $400 expenditure in year 3, a…

A: Cash flows refer to the movement of money into and out of a business or individual's financial…

Q: The Lee-Key Roof Company has offered a small company two method by which to pay for some needed roof…

A: Given. The small company can make two type of payments:  1) $5000 now  2) $8000 from 2 years from…

Q: A company expects the cost of equipment maintenance to be s5,000 in year one, s$5,500 in year two,…

A: The present worth can get determined using the following formula: Present Worth=Cash Flow Each…

Q: O both the noncompetitive firm and the purely competitive firm.

A:

Q: Valley Rendering, Inc. is considering purchasing a new flotation system for grease recovery. The…

A: The cost of borrowing money or the incentive to save it is represented by an interest rate. It is…

Q: The present sum needed to provide for an annual withdrawal of $5,000 for 15 years beginning 5 years…

A: Present value is the value of investment in today's dollar.  Future value is the value of investment…

Q: Yvonne’s father was a true believer in “giving back.” He endowed a program 35 years ago to help…

A: Given:Future value (FV)=$36000r=8%n=1 year

Q: One plan to raise money for Texas schools involves an "enrichment tax" that could collect $56 for…

A: In financial matters and money, present worth (PV), otherwise called present limited esteem, is the…

Q: A broadband service company borrowed $2 million for new equipment and repaid the loan in amounts of…

A: Initial Amount = 2000000 Cash Flow in year 1 nd 2  = 209,000 In year 3 = 2200000

Q: An U.S. auto maker plans to build two more plants in China as it aims to harness continued growth in…

A: Present value, often denoted as PV, is a financial concept that represents the current worth or…

Q: What would the return be for a $ 1000 face value coupon bond with a rate of 10% that is bought for…

A: Given information: Face value = $1000 Coupon rate = 10% Coupon payment = $1000 x 10% = $100 Purchase…

Q: a) Cash Flow Diagram b) manual solution How much money can Company C spend now instead of spending…

A: The cash flow diagram shows the income and the expenses over a certain number of years.

Q: . A manufacturing company plans to place money in a new venture capital fund that currently returns…

A: Given  Nominal interest rate r=18% per year compounded daily  The formula for effective interest…

Q: A mortgage bond issued by Automation Engineering is for sale for $8,600. The bond has a face value…

A: -Current Price of Bond (P): $8,600.- Face Value of Bond (F): $10,000.- Coupon Rate: 6% per year.-…

Q: An alternative for producing a pesticide will have a first cost of $400,000 and annual costs of…

A: Given that, First cost= $400,000 Annual cost = $40,000 Income is expected = $120,000 Interest rate =…

Q: Las Cruces' Virgin Galactic is considering two materials for certain parts in a reusable space…

A: Given data: CFRP material: Initial cost=205000 Annual maintenance cost=29000 Salvage value= 2000…

Q: If the savings will be $150,000 the first year, $160,000 the second, and amounts increasing by…

A: Year Cash flow Discount factor @15% Present worth 1 1,50,000 0.8695 130,425 2 1,60,000 0.7561…

Q: AUS Government report predicts that the US Postal Service to lose 57 billion at the end of this…

A: Step 1: Determine the Uniform Gradient of Loss IncreaseInitial loss at the end of year 1 (Year 0…

Q: An engineer launches a project in the country's top technohub. This involves rental of a computer…

A: Office investment = 100,000 Computer total investment = 35,000 x 30 = 1,050,000 Total investment =…

Q: An investment of $60,000 ten years ago resulted in uniform income of $10,000 per year for the…

A: The rate of return on investment can be calculated by the following formula :  R= Net ProfitCost of…

Q: A municipal bond with a face value of $10,000 will mature 15 years from now. The bond interest rate…

A: Present value is the value of investment in today's dollar.  Future value is the value of investment…

Q: If the profit from a capital of $1000 is equal to 5% per day and the achieved profit is added to the…

A: Step 1: Understanding Compound InterestCompound interest means that the interest earned each day is…

Q: the nonconventional bet cash fnow series shown, the external rate of retum per year using the MIRR…

A: Solution given below,

Q: For the nonconventional net cash flow series shown, the external rate of return per year using the…

A: First we will find out the value of present worth of negative values which are outflows. for this…

Q: Spectra Scientific of Santa Clara, California, manufactures Q-switched solid-state industrial lasers…

A: Cash flow:The sum of the total money is represented in the diagram. It represents the magnitude and…

Q: A company borrowed $500,000 and repaid the loan through yearly payments of $20,000 for 24 years plus…

A: Borrowed amount = $500,000 Repayment done = $24,000  For total time period of 20 years.  Single…