Aa v:- vAaBbCcDdEAaBbCcDdEeAaBbCcDdEeAaBbCcDdAaBbCcDdEeNormalBody TextList ParagraphNo SpacingTable ParagQuestion 2: Time Value of Moneya. Suppose a rancher borrows $10,000 from a bank at a 7% rate for 5 years. Using the simpleinterest method, find the interest he will pay on this loan.b. BeesW is a company selling agricultural land at $2,000 per half acre. The value of the land isexpected to appreciate at a compound rate of 5% per year. What will be the value of 20 acresof land in 10 years?How long does it take to double a $15,000 investment at a compound rate of (i) 7.5% peryear and (ii) 5% per year?с.d. Suppose a farm manager borrowed $150,000 to purchase a new tractor. If the manager hasto repay the loan after 10 years at an interest rate of 3.2% per month, what is the level ofmonthly payment?States)O FocusMacBook Pro80000000DIIDDF3F4F5F6F7F8F9F10

Money has time value and due to the interest rate and period the value of money grow with time. As…

Answered: Question 2: Time Value of Money a.…

Question 2: Time Value of Money a. Suppose a rancher borrows $10,000 from a bank at a 7% rate for 5 years. Using the simple

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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3. Time Value of Money Assume that ten years from now, you will need $10,000 and that your bank compounds interest at a 4 percent annual rate. A. How much do you need to deposit today in order to have a balance of $10,000 in 10 years? Explain and show your work. B. Suppose instead that you want to make equal payments in years 1 through 9 to accumulate $10,000 in year 10, how large must each of the 9 payments be? Explain. C. If your (very reliable) uncle were to offer to make the payments found in part (B) for you or to give you $7,000 one year from now, which would you choose? Explain. (Even if you could not solve for the answer in part B, please explain what criterion you would use to make the choice.)4. Capital Asset Pricing Model 4. Capital Asset Pricing Model In parts (A), (B), and (C) below assume that the risk-free interest rate is 3 percent and the market risk premium is 7 percent. A. Dorothy Inc. is considering a project that will generate after-tax annual cash flows of…
You borrowed $10,000 from a bank to invest in IT & Mobile technology with payback the loan in graduated payment plan. If your first payment is $1,000 at the end of first year and i=10% over 5 years. Note: (P/G, 10%, 5) = 6.86 Q/Find the total earned interest by the bank at the end of period?
24) One of the local banks indicates that it computes the interest it pays on savings accounts by the continuous compounding method. Suppose you deposited $100 in the bank and they pay 4% per annum, compounded continuously. After 5 years, how much money will there be in the account? Select one: a. $ 122.14 b. $ 144.14 c. $ 322.14 d. $ 222.14 25) At 10% per year simple interest, how long will it take for a deposit of $1000 now to accumulate to $100,000? Select one: a. n=99 years b. n=50 years c. n=44 years d. n= 990 years 26) When only one alternative can be selected from two or more, the alternatives are said to be: Select one: a. subjective alternatives b. independent alternatives c. revenue alternatives d. mutually exclusive
question 2
Part III: You have decided that you would like to buy a townhouse in 8years and will need a down payment of $30,000. How much do you need to save each year if your savings account returns an O interest rate of 3.50%. D 1N (period of time) 21 (Interest) 3 PV (Present Value 4 FV (Future Value) 5 PMT (Annuity) 26 27 28 29 30 31 32 Ready determine annuity payment which is a monthly savings of only? Bond Valuation F21r TVM Calcs Loan Amortization F21r Accessibilitir Inuoctigats After BSU, I can do this!
1. Find the simple interest on a loan of 50,000 if the loan is given at a rate of 20% and is due in 5 years 2. How much money will I have after 4, years if I deposited 10,000 in a bank that pays 5% simple interest?
2. You want to set up a savings plan for your business that you want to pursue 3 years from now. You assume that in order to start such business you need P310,000 in the bank. How much do you need to save each year in order to have the necessary funds if the current rate of interest is 8.1%? Assume that end-of-year payments are made. Illustrate the cash flow diagram to support your answer.
2. Now consider: 4.05% APR on 5 years for $23,000 car a. Estimate the monthly payment (using the average balance method) b. How much would you pay in total for interest?
Question 1
A. You borrowed $10,000 from a bank to invest in IT & Mobile technology with payback the loan in graduated payment plan. If your first payment is $1,000 at the end of first year and i=10% over 5 years. Note: (P/G, 10%, 5) = 6.86 %3D ?What is the G payment $561 $628 $730 $905 Find the total earned interest by the ?bank at the end of period $7,055 $6,100 $5,085 $4,560
You borrow $100,000 from a bank to buy a house. Is this mortgage loan an asset or liability on the bank's balance sheet? Question 29 options: Asset Liability
Question 2: Please draw the Cash Flow on the diagram. You Take a Loan to Buy an Apartment for : 100,000JD Interest Rate : 12.0% Loan Period : 30 years Down payment : 20% Registration Fees : 5% Selling Price @ year 30 : 900,000 JD Calculate the monthly payment=? Calculate the NPV.

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