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Sara bought a car last year for $12,000. She knows the car
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- Linda just graduated from college. Since she is starting her own business, it’s time to upgrade from her clunker to a reliable vehicle. Linda has the option to purchase a new car for her business at a cost of $31,416 (life of 7 years with no salvage value), estimating that it would help her bring in additional annual net operating cash flows of $7,700 over the life of the car.Determine the simple payback period and the IRR for this investment. Linda expects her business income to be subject to a 30% tax rate. (Round simple payback period to 3 decimal places, e.g. 15.256 and IRR to 2 decimal places, e.g. 15.25%. Round intermediate calculations to 2 decimal places, e.g. 15.25.) Simple payback period enter a number of years rounded to 3 decimal places years IRR enter percentages rounded to 2 decimal places %6) Susan is looking to purchase her first home five years from today. The house costs $1,550,000. She will have to make a down payment of 10% of this amount and plans to take a loan from the bank for the difference. Bank charges are approximately 15% of the loan amount. She plans to start saving from today to cover both the down payment and the bank charges. a. How much will she need to save to cover both the down payment and bank charges? b. If she currently has $195,000 in her account and will make no further deposits over the next five years, what rate of interest must she earn on this account in order to achieve the savings target calculated in part (a) above?Mrs. Jones decides to buy a house. She pays $40,000 down and pays $1500 per month for 30 years at 4% monthly. What is the cash price of the house.
- Mr. Gallagher is considering replacing his five-year-old car with a new one. The new car will cost $30,000, taking into consideration the trade-in value of the old car. The new car will save Mr. Gallagher $5,000 per year in terms of gasoline, repairs, and maintenance. Mr. Gallagher plans to keep this new car for five years. At the end of five years, the car can be sold for $8,000. What is the internal rate of return on the new car? Select one: a. 1.40% b. 2.80% c. 5.00% d. 8.14% e. 9.43%ASAP!!Mr. Dilam Gawain believes his barber shop is worth P200,000 and estimates that its value will grow at 10% per year compounded annually for the next 3 years. If he sells the business, the funds will be invested at 8% compounded quarterly for 3 years. Find (a) the future value of the business if it is to be continued and (b) what price should he sell his business at present if he chose to sell his business and still yield the same value in continuing his business?
- Joanna buys a new horse every five years. She uses a depreciation rate of 25% to estimate the value of her horse after 5 years. If after 5 years her current horse is worth $1750, how much was it when Joanna purchased it?Ruth just graduated from college. Since she is starting her own business, it's time to upgrade from her clunker to a reliable vehicle. Ruth has the option to purchase a new car for her business at a cost of $21,528 (life of 7 years with no salvage value), estimating that it would help her bring in additional annual net operating cash flows of $10,400 over the life of the car. Determine the simple payback period and the IRR for this investment. Ruth expects her business income to be subject to a 30% tax rate. (Round simple payback perlod to 3 decimal places, eg. 15.256 and IRR to 2 decimal places, eg. 15.25%. Round Intermediate calculations to 2 decimal places, eg. 15.25) Simple payback period IRR years. %Che-Che bought his brother a laptop 5 years ago which has a cost of around 25,000PhP. The laptop’s life span will last until 5 years. She has a friend which is a computer technician who advised her that the laptop’s life span could extend until 10 years if she could spend semi-annual maintenance of 100Php with a 10Php increase rate starting the next period of maintenance inspection. How much is the total future cost assuming that the money will have a rate of 2% compounded semi-annually if she decided to enjoy using her laptop beyond the expected life span upon purchasing?
- Misty needs to have $20,000 at the end of 6 years to fulfill her goal of purchasing a small sailboat. She is willing to invest a lump sum today and leave the money untouched for 6 years until it grows to $20,000, but she wonders what sort of investment return she will need to earn to reach her goal. Use your calculator or spreadsheet to figure out the annually compounded rate of return needed if she can invest $13,900 today.James loves buying antique and sells it out someday. He loves so because he believes that it will give him more wealth. But James wants to maximize his profit by any mean. Given an antique that costs $2,000,000, and it inflates 6%, the bank rate is 12%, loan period is 20 years, payments and rates are considered annually. James has two plans:(i)He borrows $2,000,000 to buy the antique. (ii)Instead of buying the antique, James would use the annual payment to do investment in the stock market. Suppose it gives 12% annual return. Which plan will James choose if he wants to maximize his wealth after 20 years?You recently inherited $10,000 that you are planning to use for a down-payment on a house in 3 years. You considering using those funds in the meantime to purchase new solar panels for your current home, with the hope that you can earn the $10,000 back by the time 3 years comes around for use as the down-payment on the new house. The manufacturer promises the panels will save $4000 per year in gas and electric costs. If you can expect i = 12%, should this equipment be purchased (ie. will you have received your money back in 3 years)?
