question 11What is the present value of investment A, B, and C at an annual discount rate of 24 percent? (Present value of annuities and complex cash flows) You are given three investment alternatives to analyze. The cash flows from these three investments are as follows:Investment1-23407coEnd of YearAB$10,000с$15,00010,00010,00010,000510,000$10,00010,00045,00010,000810,000

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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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QUESTION 8 What is the minimum nominal rate of return that you should accept if you require a 4% real rate of return and the rate of inflation is expected to average 3.5% during the investment period?
Q 23 What annual rate of return is earned on a $5,000 investment when it grows to $8,000 in four years? (Do not round intermediate calculations. Round your answer to 2 decimal places.) ANNUAL RATE OF RETURN. %
Exercise 9: You find a stable investment, that allows you to choose to one of the following plans: • 10%, compounded annually; • 9.7%, compounded quarterly; • 9.6%, compounded monthly; or 9.5%, compounded continuously. (a) Under the first plan, how long does it take for your investment to double? (b) Which plan gets the best return on your investment? Which plan gets the worst? (c) How long would it take for the return on the best plan to be double the return of the worst plan?
Problem 13-6 Calculating Rate of Return [LO13-2] Assume that at the beginning of the year, you purchase an Investment for $5,280 that pays $118 annual Income. Also assume the Investment's value has decreased to $4,880 by the end of the year. a. What is the rate of return for this investment? b. Is the rate of return a positive or a negative number? Complete this question by entering your answers in the tabs below. Required a Required b What is the rate of return for this investment? Note: Input the amount as a positive value. Enter your answer as a percent rounded to 2 decimal places. Rate of return 96
Question 16 You currently have $26,000 available for investment for a 20-year period. At what interest rate APR compounded monthly must you nvest this amount in order for it to be worth $100,000 at maturity? a) 0.56% b) 5.67% c) 6.75% d) 10.12% Answer. Question 17 You are consSidering investing in a startup project at a cost of S400,000. You expect the project to return S1,000,000 to you in 10 years. Given the risk of this project, your cost of capital is 14,5%. The NPV for this project is closest to: a) S88,681 b) S99,800 c) S109,388 d) S141,807
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question 13
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QUESTION 109 If $200 is invested at the end of each year for 8 years at a rate of 12% what will the ending value of the investment be? TRUE OR FALSE
Question 11
Question content area top Part 1 (Present value of a growing perpetuity) Your firm has taken on cost saving measures that will provide a benefit of $10,000 in the first year. These cost savings will decrease each year at a rate of 4 percent forever. If the appropriate interest rate is 6 percent, what is the present value of these savings? Question content area bottom Part 1 The present value of these cost savings is $enter your response here. (Round to the nearest cent.)

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(Present value of annuities and complex cash flows) You are given three investment alternatives to analyze. The cash flows from these three investments are as follows: Investment 1-23407co End of Year A B $10,000 с $15,000 10,000 10,000 10,000 5 10,000 $10,000 10,000 45,000 10,000 8 10,000