Interest rate. In 1972, Bob purchased a new Datsun 240Z for $2,600. Datsun later changed its name to Nissan, andthe 1972 Datsun 240Z became a classic. Bob kept his car in excellent condition and in 2002 could sell the car for fivetimes what he originally paid. What was Bob's annualized rate of return for the 30 years he owned this car? If he keepsthe car for another thirty years and earns the same rate, what could he sell the car for in 2032?What was Bob's annualized rate of return for the 30 years he owned this car?% (Round to two decimal places.)

The interest rate refers to the return that an investment provides to the investor. It is used to…

Answered: Interest rate. In 1972, Bob purchased a…

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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Ten years ago the Jacksons bought a house, taking out a 30 year mortgage for $170,000 at 6.5%. This year (exactly 10 years later) they refinanced the house, taking out a new 30 year mortgage for the remaining balance at 4.25 % . What was the monthly payment on the original 6.5% mortgage? What was the remaining balance after 10 years (the amount they then refinanced)? How much interest did they pay during those first 10 years? What is the monthly payment on the refinance 4.25% mortgage? How much interest will they pay over the 30 year term of the refinance? How much total interest will they pay over the full 40 years the Jacksons have a loan for the house?
Your parents purchased their home 15 years ago. At the time, the house cost them $400,000, but they put 15% down on the cost when they bought it. Your parents financed their purchase over 30 years, with 5.0% fixed rate loan, with monthly payments. What is their current balance of their loan?
Interest rate. In 1972, Bob purchased a new Datsun 240Z for $3,000. Datsun later changed its name to Nissan, and the 1972 Datsun 240Z became a classic. Bob kept his car in excellent condition and in 2002 could sell the car for six times what he originally paid. What was Bob's annualized rate of return for the 30 years he owned this car? If he keeps the car for another thirty years and earns the same rate, what could he sell the car for in 2032?
Rachel purchased a car for $17,500 three years ago using a 4-year loan with an interest rate of 10.8 percent. She has decided that she would sell the car now, if she could get a price that would pay off the balance of her loan. What is the minimum price Rachel would need to receive for her car? Calculate her monthly payments, then use those payments and the remaining time left to compute the present value (called balance) of the remaining loan.
Please answer with explanation. I will really upvote. Thanks
O A few years back, Dave and Jana bought a new home. They borrowed $230,415 at an annual fixed rate of 5.49% (15-year term) with monthly payments of $1,881.46. They just made their 35th payment, and the current balance on the loan is $208,555.87. Interest rates are at an all-time low, and Dave and Jana are thinking of refinancing to a new 15-year fixed loan. Their bank has made the following offer: 15-year term, 3.0%, plus out-of- pocket costs of $2,937. The out-of-pocket costs must be paid in full at the time of refinancing. Build a spreadsheet model to evaluate this offer. The Excel function: -PMT(rate, nper, pv, fv, type) calculates the payment for a loan based on constant payments and a constant interest rate. The arguments of this functionare: rate the interest rate for the loan nper the total number of payments pv-present value (the amount borrowed) N= future value [the desired cash balance after the last payment (usually 0)) type payment type (0-end of period, 1 beginning of the…
Your eccentric (and rich uncle) is thrilled that you are pursuing your undergraduate in business administration. For the next 40 years (starting 1 year from now; last payment 40 years from now), he will pay you $2000 every odd year (1st, 3rd, etc.) and $3000 every even year (2nd, 4th, etc.). The relevant discount rate is 5% per year. What is the present value of all the money you will receive from this source over the next 40 years?
A few years ago Dimi bought himself a house. He received a loan from his bank of 250,000 euros that he needed to pay back with constant monthly payments during 20 years at ?1/12= 0.12% . After five years of paying back the loan, Dimi wants to borrow an additional amount to buy a warehouse for his business. The amount is equal to the principal that has been repaid in that period. How much can he borrow? (I will send you another question that related to this answered after you provide the solution) please answer in paper its easy to understand
Dusty would like to buy a new car in six years. He currently has $15,000 saved. He's considering buying a car for around $19,000 but would like to add a Turbo engine to increase the car's performance. This would increase the price of the car to $23,000. If Dusty can earn 9% interest, compounded annually, will he be able to get a car with a Turbo engine in six years?
Future value. Jack and Jill are saving for a rainy day and decide to put $40 away in their local bank every year for the next 20 years. The local Up-the-Hill Bank will pay them 6% on their account. a. If Jack and Jill put the money in the account faithfully at the end of every year, how much will they have in it at the end of 20 years? b. Unfortunately, Jack had an accident in which he sustained head injuries after only 10 years of savings. The medical bill has come to $400. Is there enough in the rainy-day fund to cover it? a. If Jack and Jill put the money in the account faithfully at the end of every year, how much will they have in it at the end of 20 years? $nothing (Round to the nearest cent.)
Beverly and Kyle currently insure their cars with separate companies, paying $500 and $510 a year. If they insured both cars with the same company, they would save 15 percent on the annual premiums. What would be the future value of the annual savings over 10 years based on an annual interest rate of 6 percent? Use Exhibit 1-B. (Do not round intermediate calculations. Round time value factor to 3 decimal places and final answer to 2 decimal places.) Future value of annual savings
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