Olivia, born in 1990, graduated from college in 2011. Her graduation was funded by a scholarship she won on merit and she inherited stocks worth $200. After graduation, in 2012, Olivia started supporting herself. She got a job in a financial firm and planned to work for 4 years after which she wanted to enroll in a fashion designing course for 2 years which cost $75 per year in real terms. In the financial firm, she earned $50 in real terms in her first year of employment and it is expected to increase by 6% every year in real terms. After earning her certification in fashion designing, she is expected to earn $70 in real terms in her first year of employment as a fashion designer and it is expected to increase by 4% every year in real terms. She plans to retire by 2030 to do some work in charity and is expected to live up to 2050. If the real rate of interest is 2% per year and the labor tax rate is 30% per year, the consumption for each year until 2050 is $ per year in real terms. (Round your answer to two decimal places.)

Olivia, born in 1990, graduated from college in 2011. Her graduation was funded by a scholarship she won on merit and she inherited stocks worth $200. After graduation, in 2012, Olivia started supporting herself. She got a job in a financial firm and planned to work for 4 years after which she wanted to enroll in a fashion designing course for 2 years which cost $75 per year in real terms. In the financial firm, she earned $50 in real terms in her first year of employment and it is expected to increase by 6% every year in real terms. After earning her certification in fashion designing, she is expected to earn $70 in real terms in her first year of employment as a fashion designer and it is expected to increase by 4% every year in real terms. She plans to retire by 2030 to do some work in charity and is expected to live up to 2050. If the real rate of interest is 2% per year and the labor tax rate is 30% per year, the consumption for each year until 2050 is $ per year in real terms. (Round your answer to two decimal places.)

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

See similar textbooks

Similar questions

Hazha graduated from AUIS with BA from business administration, she start works as finance officer in a British company. She use the knowledge she learn from FIN301 class to plan for her future. She start saving at age of 25 years old, $300 a month until. Hazha got married at age 30 and also got promoted from her job, she increases saving to $500 a month. How much money she will have when she retiared at age of 60, if she invested all her saving in an investment company that pay 11% return annually compounding annually.
Your parents have accumulated a $120,000 nest egg. They have been planning to use this money to pay college costs to be incurred by you and your sister, Courtney. However, Courtney has decided to forgo college and start a nail salon. Your parents are giving Courtney $15,000 to help her get started, and they have decided to take year-end vacations costing $10,000 per year for the next four years. How much money will your parents have at the end of four years to help you with graduate school? You plan to work on a master’s and perhaps a PhD. If graduate school costs $26,353 per year, approximately how long will you be able to stay in school based on these funds? Use 9 percent as the appropriate interest rate throughout this problem. Round all values to whole numbers Flag question: Question 6 Question 64.5 pts What are the funds available after the Nail Salon? Group of answer choices $100,000 $105,000 $72,000 $98,500 Flag question: Question 7 Question 74.5…
Jessica just graduated from college with a degree in philosophy and has landed herself a great job – at McDonald’s. Now it’s time for her to begin paying back her college loan. For the next 12 years she will be making a monthly loan payment of $232.40. The loan has an APR of 4.75%. What was the amount of Jessica’s college loan? How much interest will Jessica have paid by the end of the loan?
Hank has a $30,000.00 GIC which is locked in for the next 2 months at which time he can access his money. Today he was offered the opportunity to purchase his friends antique Harley Davidson motorcycle for $20,000.00 providing he can pay for it in the next few days or his friends is going to sell it on Kjiji. Hank really wants the motorcycle and has approached Everyday Bank about a loan noting that he can only afford a very small payment. What product would best meet Hank’s needs? a. A personal line of credit for $20,000.00 b. An interest only demand koan for $20,000.00 c. A fixed repayment Loan for $20,000.000 with a variable interest rate and fixed monthly payments. d. An Everyday Bank MasterCard with a limit of $20,000.00
Elizabeth recently calculated her financial score. She was stunned to see how low it turned out to be. Undaunted, Elizabeth is determined to turn her financial situation around. To do this, she has set a financial goal to create an emergency savings fund. She can save $440 per month ($5,280 per year). She would like to accumulate $21.720 over the next 4 years. If Elizabeth can earn a 5% rate of return on her yearly savings, do you think she will accomplish her goal? (Round future value factor calculations to 5 decimal places, e.g. 1.25124 and final answer to 2 decimal places, e.g. 52.75.) Future value of an annuity Elizabeth accomplish her goal.
Lindsay is 29 years old and has a new job in web development. She wants to make sure that she is financially sound by the age of 55, so she plans to invest the same amount into a retirement account at the end of every year for the next 26 years. (a) Construct a data table in Excel that will show Lindsay the balance of her retirement account for various levels of annual investment and return. If Lindsay invests $10,000 at return of 6%, what would be the balance at the end of the 26th year? Note that because Lindsay invests at the end of the year, there is no interest earned on the contribution for the year in which she contributes. Round your answer to a whole dollar amount. $ 10,000
Anne earned emoluments as a marketing manager with Jabem Chocolate Ltd. Jablem did not have an ESOP plan. In 2008 as a member of the management team she was offered shares in jablem which she could purchase at 50%of their marketable value. She borrowed the money from her credit union and paid for the shares in full. In 2009 jablem paid a dividend which Anne brought to account in her annual return. In 2010 and 2013 Anne received no dividends in respect of the jablem shares. In filling her returns for these years, Anne claimed deductions for the interest paid on the money she had borrowed from her credit union. Discuss whether it is likely that the interest expense will be allowable by the commissioners in the years when no dividends were earned. In your answer make reference to Thwaites v CIT{Jamaica, 1973}; woodroffe v CIT (Grenada, 1966), wharf properties limited v commissioners of inland revenue (Hong Kong 1997).
James and Tanisha are saving for their daughter Nalah's college education. Nalah just turned 10 (at t = 0), and she will be entering college 8 years from now (at t = 8). College tuition and expenses at State U. are currently $16,000 a year, but they are expected to increase at a rate of 3.5% a year. Nalah should graduate in 4 years--if she takes longer or wants to go to graduate school, she will be on her own. Tuition and other costs will be due at the beginning of each school year (at t = 8, 9, 10, and 11). So far, James and Tanisha have accumulated $14,000 in their college savings account (at t = 0). Their long-run financial plan is to add an additional $6,000 in each of the next 4 years (at t = 1, 2, 3, and 4). Then they plan to make 3 equal annual contributions in each of the following years, t = 5, 6, and 7. They expect their investment account to earn 10%. How large must the annual payments at t = 5, 6, and 7 be to cover Nalah's anticipated college costs? O a. $3,501.99 O O b.…
Charlotte has just finished her MBA and started a career in banking investment, she wanted to have a new car as soon as possible. The price of the car is $ 28,320. She must also have clothes and coats for the job which costs $ 3,248. The salary for his job this year is $ 42,000 and next year it will be increasing to $ 46,000. The cost of living this year is $ 34,000. Charlotte plans to make the difference between income and expenditure for consumption by borrowing. Interest on the loan is 15% per year. Charlotte wants to pay the loan and interest within a year. How much money is left for next year that Charlotte can spend (consume)?
Justin and Kennedy are saving for their daughter Aliyah's college education. Aliyah just turned 10 (at t = 0), and she will be entering college 8 years from now (at t = 8). College tuition and expenses at State U. are currently $15,000 a year, but they are expected to increase at a rate of 2.5% a year. Aliyah should graduate in 4 years--if she takes longer or wants to go to graduate school, she will be on her own. Tuition and other costs will be due at the beginning of each school year (at t = 8, 9, 10, and 11). So far, Justin and Kennedy have accumulated $10,000 in their college savings account (at t = 0). Their long-run financial plan is to add an additional $5,500 in each of the next 4 years (at t = 1, 2, 3, and 4). Then they plan to make 3 equal annual contributions in each of the following years, t = 5, 6, and 7. They expect their investment account to earn 8%. How large must the annual payments at t = 5, 6, and 7 be to cover Aliyah's anticipated college costs? a. $5,960.00 b.…
John and Daphne are saving for their daughter Ellen's college education. Ellen just turned 10 (at t= 0), and she will be entering college 8 years from now (at t = 8). College tuition and expenses at State U. are currently $14,500 a year, but they are expected to increase at a rate of 3.5% a year. Ellen should graduate in 4 years--if she takes longer or wants to go to graduate school, she will be on her own. Tuition and other costs will be due at the beginning of each school year (at t = 8, 9, 10, and 11). So far, John and Daphne have accumulated $14,000 in their college savings account (at t= 0). Their long-run financial plan is to add an additional $5,000 in each of the next 4 years (at t = 1, 2, 3, and 4). Then they plan to make 3 equal annual contributions in each of the following years, t = 5, 6, and 7. They expect their investment account to earn 9%. How large must the annual payments at t = 5, 6, and 7 be to cover Ellen's anticipated college costs? a. $3,326.86 b. $2,970.41 C.…
Your parents have accumulated a $120,000 nest egg. They have been planning to use this money to pay college costs to be incurred by you and your sister, Courtney. However, Courtney has decided to forgo college and start a nail salon. Your parents are giving Courtney $15,000 to help her get started, and they have decided to take year-end vacations costing $10,000 per year for the next four years. How much money will your parents have at the end of four years to help you with graduate school? You plan to work on a master's and perhaps a PhD. If graduate school costs $26,353 per year, approximately how long will you be able to stay in school based on these funds? Use 9 percent as the appropriate interest rate throughout this problem. Round all values to whole numbers. Refer to this information to solve the rest of the questions. What are the funds available after the Nail Salon? ○ $100,000 ○ $105,000 ○ $72,000 $98,500 What is the Present Value of the vacations? $32,397 $37,900 $45,000…

SEE MORE QUESTIONS

Recommended textbooks for you

Essentials Of Investments

Finance

ISBN:

9781260013924

Author:

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

Publisher:

Mcgraw-hill Education,

FUNDAMENTALS OF CORPORATE FINANCE

Finance

ISBN:

9781260013962

Author:

BREALEY

Publisher:

RENT MCG

Financial Management: Theory & Practice

Finance

ISBN:

9781337909730

Author:

Brigham

Publisher:

Cengage

Foundations Of Finance

Finance

ISBN:

9780134897264

Author:

KEOWN, Arthur J., Martin, John D., PETTY, J. William

Publisher:

Pearson,

Fundamentals of Financial Management (MindTap Cou…

Finance

ISBN:

9781337395250

Author:

Eugene F. Brigham, Joel F. Houston

Publisher:

Cengage Learning

Corporate Finance (The Mcgraw-hill/Irwin Series i…

Finance

ISBN:

9780077861759

Author:

Stephen A. Ross Franco Modigliani Professor of Financial Economics Professor, Randolph W Westerfield Robert R. Dockson Deans Chair in Bus. Admin., Jeffrey Jaffe, Bradford D Jordan Professor

Publisher:

McGraw-Hill Education

Essentials Of Investments

Finance

ISBN:

9781260013924

Author:

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

Publisher:

Mcgraw-hill Education,

FUNDAMENTALS OF CORPORATE FINANCE

Finance

ISBN:

9781260013962

Author:

BREALEY

Publisher:

RENT MCG

Financial Management: Theory & Practice

Finance

ISBN:

9781337909730

Author:

Brigham

Publisher:

Cengage

Foundations Of Finance

Finance

ISBN:

9780134897264

Author:

KEOWN, Arthur J., Martin, John D., PETTY, J. William

Publisher:

Pearson,

Fundamentals of Financial Management (MindTap Cou…

Finance

ISBN:

9781337395250

Author:

Eugene F. Brigham, Joel F. Houston

Publisher:

Cengage Learning

Corporate Finance (The Mcgraw-hill/Irwin Series i…

Finance

ISBN:

9780077861759

Author:

Stephen A. Ross Franco Modigliani Professor of Financial Economics Professor, Randolph W Westerfield Robert R. Dockson Deans Chair in Bus. Admin., Jeffrey Jaffe, Bradford D Jordan Professor

Publisher:

McGraw-Hill Education

SEE MORE TEXTBOOKS