Your broker calls you and tells you that he has this great investment opportunity. If you invest $100 today, you will receive $45 in one year and $75 in two years. lf you require a 15% return on investments of this risk, should you take the investment? Seleccione una: a. Yes, this investment yields a lower rate of return than I require. O b. No, this investment yields a higher rate of return than I require. OC. Yes, this investment yields a higher rate of return than I require. d. No, this investment yields a lower rate of return than I require.

Your broker calls you and tells you that he has this great investment opportunity. If you invest $100 today, you will receive $45 in one year and $75 in two years. lf you require a 15% return on investments of this risk, should you take the investment? Seleccione una: a. Yes, this investment yields a lower rate of return than I require. O b. No, this investment yields a higher rate of return than I require. OC. Yes, this investment yields a higher rate of return than I require. d. No, this investment yields a lower rate of return than I require.

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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Similar questions

Justin Lieberman must earn a minimum rate of return of 16.79% as compensation for the risk of the following investment a. Use present value techniques to estimate the IRR on this investment. b. On the basis of your finding in part a, should Justin make the proposed investment? a. The yield on this investment is %. (Round to two decimal places.) Data table Initial Investment End of Year 1 2345 $15,119 Income $3,957 $4,879 $5,900 $3,601 $2,000 - X C
(3) Today you have paid $275 for an investment that pays $100 in one year, $500 in two years,and $X in 4 years. Assuming the market interest rate is 100% and the net present value of theinvestment is zero, what must be true about X?(a) X is greater than $2,500(b) X is greater than or equal to $2,000 but less than $2,500(c) X is greater than or equal to $1,500 but less than $2,000(d) X is greater than $1,200 but less than $1,500(e) X is less than or equal to $1,200
Help me please
Investment A has a future value of $600. Investment B has a future value of $500. Both have the same present value. All else equal, which one has the higher interest rate? Select one: a. B b. A c. A=B Clear my choice
3. An investor plans to buy a property. She has two options for loans: (1) Loan balance=10, maturity=10 years, interest rate=1%; (2) Loan balance=20, maturity=10 years, interest rate=2%. The incremental (or marginal) borrowing cost by choosing the option (2), instead of the option (1), is approximately x%. Calculate the value of x.
Answer it correctly please. I ll rate accordingly. Typed answer only. Do fast and explain well. Two financing options are being evaluated. Which should I select? Option 1 60% equity at 12% and a loan for the balance at 9% OR 20% equity and the balance load at 12.5% per year.
You are considering a risky investment that you expect will either be worth 165,000 in 1 year, or 95,000, with probabilities of 0.6 and 0.4 for each outcome, respectively. You could invest in riskless T-bills at 0.047. If you invest in this risky investment, you would expect to earn a risk premium of 0.073 Given this information, what would you be willing to pay for this investment? O 113,881 O 106,615 O 118,358 O 122,321 O 109,991
I had an investment opportunity that requires an initial investment of GH¢5000 today and will pay GH¢6000 on a year's time. So if i had an alternative imvestment with similar risk of 25%, should i invest??
You have an opportunity to invest $50,600 now in return for $60,800 in one year. If your cost of capital is 7.9%, what is the NPV of this investment?
Dog You are considering the purchase of real estate that will provide perpetual income that should average$61,000 per year. How much will you pay for the property if you believe its market risk is the same as themarket portfolio%u2019s? The T-bill rate is 3%, and the expected market return is 12.5%.
You are considering a risky investment that you expect will either be worth 115,000 in 1 year, or 65,000, with probabilities of 0.65 and 0.35 for each outcome, respectively. You could invest in riskless T-bills at 0.058. If you invest in this risky investment, you would expect to earn a risk premium of 0.091 Given this information, what would you be willing to pay for this investment? 84,856 78,059 79,001 73,655 82,693
Consider a risky portfolio. The end-of-year cash flow derived from the portfolio will be either $150,000 or $290,000 with equal probabilities of 0.5. The alternative risk-free investment in T-bills pays 3% per year. Required: a. If you require a risk premium of 7%, how much will you be willing to pay for the portfolio? b. Suppose that the portfolio can be purchased for the amount you found in (a). What will be the expected rate of return on the portfolio? c. Now suppose that you require a risk premium of 12%. What price are you willing to pay? Complete this question by entering your answers in the tabs below. Required A Required B Required C If you require a risk premium of 8%, how much will you be willing to pay for the portfolio? Note: Do not round your intermediate calculations. Round your answer to the nearest whole dollar amount. Price Required A Required B >

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