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Scenario 1. Your grandparents gave you P 175,000.00 on your 16th birthday. You were instructed to invest the money so that the earnings can be used to pay for your tuition fee in college. Having heard about the risks and rewards of the stock market from your parents, you become interested in buying stocks in a particular company. Below are the options given to you by your parents: Option 1: Company ABC's selling stock is P 1,500.00 per share that will have a dividend of P 200.00 per year. The stock can be sold after two years at P2,000.00 and the market requires a rate of return of 15%. Option2: Company XYZ's selling stock is P 1,000.00 per share that will have a dividend of P 180.00 per year. The stock can be sold after two years at P2,000.00 and the market requires a rate of return of 7%. In which company will you invest your money? Why?

Scenario 1. Your grandparents gave you P 175,000.00 on your 16th birthday. You were instructed to invest the money so that the earnings can be used to pay for your tuition fee in college. Having heard about the risks and rewards of the stock market from your parents, you become interested in buying stocks in a particular company. Below are the options given to you by your parents: Option 1: Company ABC's selling stock is P 1,500.00 per share that will have a dividend of P 200.00 per year. The stock can be sold after two years at P2,000.00 and the market requires a rate of return of 15%. Option2: Company XYZ's selling stock is P 1,000.00 per share that will have a dividend of P 180.00 per year. The stock can be sold after two years at P2,000.00 and the market requires a rate of return of 7%. In which company will you invest your money? Why?

Advanced Engineering Mathematics
Advanced Engineering Mathematics
10th Edition
ISBN:9780470458365
Author:Erwin Kreyszig
Publisher:Erwin Kreyszig
Chapter2: Second-order Linear Odes
Section: Chapter Questions
Problem 1RQ
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11:48:55 0: 0.00 KB/S 3 .ll ..l 8 GeneralMathe... Reflection. Going back to our first problem, it is time to review our answers. You can now decide correctly after this learning experiences. Scenario 1. Your grandparents gave you P 175,000.00 on your 16th birthday. You were instructed to invest the money so that the earnings can be used to pay for your tuition fee in college. Having heard about the risks and rewards of the stock market from your parents, you become interested in buying stocks in a particular company. Below are the options given to you by your parents: Option1: Company ABC's selling stock is P 1,500.00 per share that will have a dividend of P 200.00 per year. The stock can be sold after two years at P2,000.00 and the market requires a rate of return of 15%. Option2: Company XYZ's selling stock is P 1,000.00 per share that will have a dividend of P 180.00 per year. The stock can be sold after two years at P2,000.00 and the market requires a rate of return of 7%. In which company will you invest your money? Why? Scenario 2. Suppose that you withdraw P 1,500.00 from your savings account. Over the weekend, several people want to borrow money from you. Read the stories and decide to whom you will lend your money. Story1. Your younger sister is having a garage sale. She needs cash to make change for the day. She will sell you a bond for P 1,000.00 You will keep the bond for a week, and she promises to pay you back. Story2. Your older brother has a small business idea but doesn't have any money. He wants to borrow your P 1,500.00 and promises to pay you back P 1,800.00 in four weeks. Story3. Your best friend at school, whom you know very-well, wants to borrow your P 1,500.00 to buy cupcakes. She plans to sell at a higher price and promises to pay you back P1,700.00 in two weeks. Whose bonds will you buy? Why? 13 cO Q2_General Mathemr' Modi II
Transcribed Image Text:11:48:55 0: 0.00 KB/S 3 .ll ..l 8 GeneralMathe... Reflection. Going back to our first problem, it is time to review our answers. You can now decide correctly after this learning experiences. Scenario 1. Your grandparents gave you P 175,000.00 on your 16th birthday. You were instructed to invest the money so that the earnings can be used to pay for your tuition fee in college. Having heard about the risks and rewards of the stock market from your parents, you become interested in buying stocks in a particular company. Below are the options given to you by your parents: Option1: Company ABC's selling stock is P 1,500.00 per share that will have a dividend of P 200.00 per year. The stock can be sold after two years at P2,000.00 and the market requires a rate of return of 15%. Option2: Company XYZ's selling stock is P 1,000.00 per share that will have a dividend of P 180.00 per year. The stock can be sold after two years at P2,000.00 and the market requires a rate of return of 7%. In which company will you invest your money? Why? Scenario 2. Suppose that you withdraw P 1,500.00 from your savings account. Over the weekend, several people want to borrow money from you. Read the stories and decide to whom you will lend your money. Story1. Your younger sister is having a garage sale. She needs cash to make change for the day. She will sell you a bond for P 1,000.00 You will keep the bond for a week, and she promises to pay you back. Story2. Your older brother has a small business idea but doesn't have any money. He wants to borrow your P 1,500.00 and promises to pay you back P 1,800.00 in four weeks. Story3. Your best friend at school, whom you know very-well, wants to borrow your P 1,500.00 to buy cupcakes. She plans to sell at a higher price and promises to pay you back P1,700.00 in two weeks. Whose bonds will you buy? Why? 13 cO Q2_General Mathemr' Modi II
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