U A. B. OC. 1. The alternatives shown are to be compared on the basis of their present worth values. At an interest rate of 10% per year, the values of n that you should use in the uniform series factors to make a correct comparison by the present worth method are: first cost, S annual operating cost, S salvage value, $ life, years B.-151027.4 A. -175306.4 A.-151027.4 B.-175306.4 A.-151127.4 B. -175316.4 A -50000 -10000 13000 3 B -90000 -4000 15000 6

U A. B. OC. 1. The alternatives shown are to be compared on the basis of their present worth values. At an interest rate of 10% per year, the values of n that you should use in the uniform series factors to make a correct comparison by the present worth method are: first cost, S annual operating cost, S salvage value, $ life, years B.-151027.4 A. -175306.4 A.-151027.4 B.-175306.4 A.-151127.4 B. -175316.4 A -50000 -10000 13000 3 B -90000 -4000 15000 6

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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A, B, C
Written Work No.4 : COMPOUND INTERESTS Directions: Complete the table below. Show your solution on a separate sheet. Frequency of conversion Number of Future Value F Compound Interest Principal Nominal Periodic Term t P (P) Rate j Rate j convers (P) (P) ion n 1. 10,000 15% Monthly 5 years 2. 12% 3 years 3% 300,000 3. 15,000 bi-monthly 2 years 35,000 Semi- 4. 25,000 10% 50,000 annually
8. By taking n as 30years and using 6% both as MARR and discount rate, compare the below three possible alternatives by using NPV (net present value) and IRR methods, and recommend the best possible alternative. Alternatives Alternative A Types of cashflows Alternative C Initial capital Annual operation and ETB 40,000 maintenance cost Alternative B ЕTB 5,000,000 | ЕТB 7,000,00о |ЕTB 11,000,00 ЕТВ 100,000 ЕТВ 150,000 Annual benefit ЕТB 560,000 ЕТВ 800,000 ETB 1,050,000
Please answer part dd and ee of C, strictly follow the formula.
D, E, F
Which net present value, payback period, and interal rate of return is the best to choose. (A). 898613.67 (NPV); 4.625 years (payback period); 17.48% per year (B) 1407172.81 (NPV); 2.778 years (payback period); 30.93% per year (C) 1487140.50 (NPV); 3.00 years (payback period); 32.06% per year
j. Find the PV and the FV of an investment that makes the following end-of-year payments. The interest rate is 8%. Year 1 $100, Year 2 $200, Year 3 $400 Year Payment 1 100 2 200 3 400 Rate 8% To find the PV, use the NPV function: Pv= $581.59 Year Payment x (1+ I)^(N- t) = FV 1 100 2 200 3 400
Calculate the present value of the following single amounts. (FV of $1, PV of $1, FVA of $1, and PVA of $1) (Use appropriate factor(s) from the tables provided. Round your answers to 2 decimal places.) Future Value Annual Rate Interest Compounded Period Invested Present Value 1. $8,300 4 % Annually 3 years $7,378.70 2. 5,300 10 % Semiannually 6 years 4,578.35 3. 4,300 8 % Quarterly 2 years
Determine the present worth in year 0 of the following cost. Interest rate is 10% per year. Year Cost ($1000) 0 -850 1 -300 2 -400 -400 -400 -500 WN 3 4 5
Kk201. An asset produces $150 in two years, and $250 in four years, and the current price has been calculated toreflect a rate of return of 9% annually. Using the definition that convexity = second derivative of pricedivided by price, find the convexity of this asset evaluated at the annual yield rate of 9%.
Calculate the future value of the following single amounts. (FV of $1, PV of $1, FVA of $1, and PVA of $1) (Use appropriate factor(s) from the tables provided. Round your answers to 2 decimal places.) Initial Investment Annual Rate Interest Compounded Period Invested Future Value 1. $7,400 10 % Annually 7 years $14,420.00 2. 5,400 12 % Semiannually 4 years 3. 8,400 8 % Quarterly 4 years
7. Future values (S2.1) Compute the future value of a $100 investment for the following combinations of rates and times. = 6%, t = 10 years. b. r= 6%, t = 20 years. c. r = 4%, t = 10 years. d. r = 4%, t = 20 years. a. r =

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