PFIN 7:STUDENT EDITION-TEXT
7th Edition
ISBN: 9780357033616
Author: Billingsley
Publisher: CENGAGE L
expand_more
expand_more
format_list_bulleted
Videos
Textbook Question
Chapter 4, Problem 8FPE
Determining the right amount of short-term, liquid investments. Ella and Aaron Martin together earn approximately $92,000 a year after taxes. Through an inheritance and some wise investing, they also have an investment portfolio with a value of almost $200,000.
- a. How much of their annual income do you recommend the Martins hold in some form of liquid savings as reserves? Explain.
- b. How much of their investment portfolio do you recommend they hold in savings and other short-term investment vehicles? Explain.
- c. How much, in total, should they hold in short-term liquid assets?
Expert Solution & Answer
Trending nowThis is a popular solution!
Students have asked these similar questions
Ella and Aaron Martin together earn approximately $92,000 a year after taxes. Through an inheritance and some wise investing, they also have an investment portfolio with a value of almost $200,000.
a. How much of their annual income do you recommend the Martins hold in some form of liquid savings as reserves? Explain.
b. How much of their investment portfolio do you recommend they hold in savins and other short-term investment vehicles? Explain.
c. How much, in total, should they hold in short-term liquid assets?
Ella and Aaron Martin together earn approximately $92,000 a year after taxes. Through an inheritance and some wise investing, they also have an investment portfolio with a value of almost $200,000.
a. how much of annual income do you reccoment they hold in liquid savings as reserves? why?
b. How much of their investment portfolio do you reccoment they hold in savings and other short term vehicles? Explain.
c. How much, in total, should they hold in short term liquid assets?
Determine the right amount of short term, liquid assets.
(Explain.)
(Explain.)
How much in total in liquid assets:
Finance
3. Tyler and Sarah earn approximately $93,000 a
year after taxes. They have an investment portfolio
of $177,000. How múch should they have in liquid
savings for emergencies? How much of their
investment portfolio should be in short-term
investments? How much, in total, should they hold
in short-term liquid assets
Chapter 4 Solutions
PFIN 7:STUDENT EDITION-TEXT
Ch. 4 - Prob. 1LOCh. 4 - Describe todays financial services marketplace,...Ch. 4 - Prob. 3LOCh. 4 - Prob. 4LOCh. 4 - Prob. 5LOCh. 4 - Develop a cash management strategy that...Ch. 4 - Adapting to a low-interest-rate environment. A...Ch. 4 - Prob. 2FPECh. 4 - Choosing a new bank. Youre getting married and...Ch. 4 - Prob. 4FPE
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, finance and related others by exploring similar questions and additional content below.Similar questions
- DETERMINING THE RIGHT AM OUNT OF SHORT-TERM, LIQUID INVESTM ENTS. Leo and Ava Bryant together earn approximately 92,000 a year after taxes. Through an inheritance and some wise investing, they also have an investment portfolio with a value of almost 200,000. a. How much of their annual income do you recommend the Bryants hold in some form of liquid savings as reserves? Explain. b. How much of their investment portfolio do you recommend they hold in savings and other short-term investment vehicles? Explain. c. How much, in total, should they hold in short-term liquid assets?arrow_forwardYour friend has a trust fund that will pay her the following amounts at the given interest rate for the given number of years. Calculate the current (present) value of your friend’s trust fund payments. Present value and future value tables: https://openstax.org/books/principles-managerial-accounting/pages/time-value-of-moneyarrow_forwardExplain well all point of ququestion with proper answer .arrow_forward
- PLEASE DO ALL PARTS OF THE QUESTION / PROBLEMarrow_forwardMichiko would want to invest her funds in a trust fund that pays a simple interest rate of 2.5 percent per year on its principal. Consider the following scenario: she wishes to invest Php 200,000 for three years a. What do you think the future worth of her investment will be? b. How much interest will she earn?arrow_forwardHelparrow_forward
- I need help working this problem out. Figuring out what table to use, whether to use: compound value, present value, amount of annuity, present value of annuity, sinking fund value? Please explain in detail each step. Nina deposits $3400 into a savings account earning simple interest at 6.3% annually. She intends to leave the money in the bank for three years. How much money, including both principal and interest, can she withdraw at the end of this time?arrow_forward(Use Calculator or Formula Approach) Your parents set up a trust fund for you 10 years ago that is now worth $19,671.51. If the fund earned 7% per year, how much did your parents invest?arrow_forwardYour grandfather left an inheritance for you of $100,000. However you can only drawdown on the investment as follows:arrow_forward
- Solve the following problems on a sheet of paper. What Have I Learned So Far? Solve the following problems on a sheet of paper. Your parents wanted to establish a travel fund that will provide them an annual traver 1. allowance of P250 000 for 10 years when they retire, How much should they invest in a trust fund that earns 4% interest compounded monthly if they are to retire in 5 years? 2. How much should a mother invest now for a long-term investment that offers 10% interest compounded monthly if she desires to provide her son a 5-year college fund of P120 000 annually, 6 years from now?arrow_forwardNeed assistance with this please provide the best answerarrow_forwardNeed help with thisarrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
Pfin (with Mindtap, 1 Term Printed Access Card) (...FinanceISBN:9780357033609Author:Randall Billingsley, Lawrence J. Gitman, Michael D. JoehnkPublisher:Cengage Learning
PFIN (with PFIN Online, 1 term (6 months) Printed...FinanceISBN:9781337117005Author:Randall Billingsley, Lawrence J. Gitman, Michael D. JoehnkPublisher:Cengage Learning
Financial Accounting: The Impact on Decision Make...AccountingISBN:9781305654174Author:Gary A. Porter, Curtis L. NortonPublisher:Cengage Learning
Pfin (with Mindtap, 1 Term Printed Access Card) (...
Finance
ISBN:9780357033609
Author:Randall Billingsley, Lawrence J. Gitman, Michael D. Joehnk
Publisher:Cengage Learning
PFIN (with PFIN Online, 1 term (6 months) Printed...
Finance
ISBN:9781337117005
Author:Randall Billingsley, Lawrence J. Gitman, Michael D. Joehnk
Publisher:Cengage Learning
Financial Accounting: The Impact on Decision Make...
Accounting
ISBN:9781305654174
Author:Gary A. Porter, Curtis L. Norton
Publisher:Cengage Learning
Understanding Credit; Author: UCBStudentAffairs;https://www.youtube.com/watch?v=EBdXREhOuME;License: Standard Youtube License