Problem B: Life Insurance Evaluate two investment options. i-10% n=20 Option A: Invest $150,000 today receive $450,000 after 20 yrs (end of life) or Option B: invest $100,000 today receive $380,000 after 20 yrs (end of life)

Problem B: Life Insurance Evaluate two investment options. i-10% n=20 Option A: Invest $150,000 today receive $450,000 after 20 yrs (end of life) or Option B: invest $100,000 today receive $380,000 after 20 yrs (end of life)

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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ques 6
K Compare the monthly payments and total loan costs for the following pairs of loan options. Assume that both loans are fixed rate and have the same closing costs. You need a $160,000 loan. Option 1: a 30-year loan at an APR of 9%. Option 2: a 15-year loan at an APR of 8.5%. Find the monthly payment for each option. The monthly payment for option 1 is $ The monthly payment for option 2 is $ (Do not round until the final answer. Then round to the nearest cent as needed.) Find the total amount paid for each option. The total payment for option 1 is $ The total payment for option 2 is $ (Use the answers from the previous step to find this answer. Round to the nearest cent as needed.) Compare the two options. Which appears to be the better option? OA. Option 1 is the better option, but only if the borrower plans to stay in the same home for the entire term of the loan. OB. Option 1 will always be the better option.
Pleas ehelp me do this step by step last solution incorrect
Consider a 30-year, fixed-rate mortgage for $120,000 at a nominal rate of 6% with monthly payments. If the borrower pays an additional $120 with each monthly payment, what will be the amount of the last monthly payment? A. $839.46 B. $357.77 C. $843.66 D. $419.85 E. $355.99 F. $420.90 G. $418.81 H. $841.55
Öption 1: 20% down payment and fihancing at 7% SImple per Option 2: no down payment and financing at 7.75% simple interest for 3 years. Answer each of the following questions separately, showing all your work to reach each answer. A. Which option will result in smaller total finance charge? What will that total finance charge be? B. Which option will result in the smaller monthly payment? What will that monthly payment be? C. They decide to defer any purchases and invest in a savings account a $2400 bonus that Maria will be getting from work. The rate is 1.5% interest compounded every month. How much interest will they earn in 3 years? D. They decide to defer any purchases and loan the $2400 bonus to a needy relative at 3% simple interest per year. How long will the term of the loan need to be if they want to earn $300 in interest (assuming the loan is not paid off early).
Multiple Choice Assume you are investing $100 today in a savings account. Which one of the following terms refers to the total value of this investment one year from now? о O O Future value Present value Principal amount Discounted value Invested principal 5 Saved Help Save & Exit 8 Submit
Consider the following options for a $153,000 mortgage. Calculate the monthly payment and total closing costs for each option. Which option would Clearly explain why you chose the option that you chose. you choose? Option 1: a 30-year fixed-rate loan at 4.3% with $1500 closing cost and no points • Option 2: a 30-year fixed-rate loan at 3.8% with $1200 closing cost and 2 points
What are the possible wealth outcomes for a person with $10,000 in wealth who faces a 10 percent chance of losing $5,000 under each of the following insurance policies'? a. $2,500 of coverage; premium = $250. b. $2,500 of coverage: premium = $280. c. $5,000 of coverage; premium = $500. d. $5,000 of coverage: premium = $550.
Question No: 06 Multiple Choice (Select 1 out of 4 options, for the question below. ) Which of the following is not a method to pay dividend to shareholders? Options O cash payout O Payment in kind O stock dividend O Bonus share Clear Responso
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Hi, how do i solve this corp fi problem without using excel? Retirement options: Option 1: Make $1364.6 per month if you start your CPP at age 65. Option 2: Delay taking your CPP benefits until after 65, your monthly income will increase by0.7% for each month that you delay, up until age 70. Discount rate is .04 per month Question: What is present value at age 65 of your CPP payments if you begin taking them at 65? what is the present value at age 70 of your CPP payments if you begin taking them at 70?
Give typing answer with explanation and conclusion Assume you want to borrow $300,000 and have been presented with two options. The first option is a fully amortizing loan with an interest rate of 3% and $4000 of origination fees and points. The second option is an interest only loan with an interest rate of 4% and $5000 of origination fees and points. Both loans are for 30 years and have monthly payments. Further assume that if the borrower chooses the interest only loan, any money saved on the monthly payment can be invested with a projected return of 7%. Also assume that the proceeds from the investment will first be used to pay off any remaining balance on the loan. How much money will the investor have left at the end of 30 years after repaying the loan? Group of answer choices None, the investor will owe $12,373.42 $323,060.72 $22,063.08 $30,750.78

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