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Envision that you have served as business manager of Media World for over 2 years

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Question

Envision that you have served as business manager of Media World for over 2 years. You have noticed that for the last 12 months the business has regularly had cash assets of $20,000 or more at the end of each month. You have found a 6-month certificate of deposit that pays 6% compounded monthly. To obtain this rate of interest savings account that pays 3% compounded daily. Based on the cash position of the business at this time, assume that you decide to invest $4,000.;1. Assume that you will invest the full amount in a certificate of deposit.;a. what would be the future value of the CD at the end of the investment term?;b. how much interest would the investment earn for the period?;c. what would be the effective rate of the investment?;2. assume that you decide to invest the $4,000 in the high-interest savings account.;a. what future value would you except to receive at the end of 6 months?;b. how much interest would the investment earn for the period?;c. what would be the effective rate of the investment?;3. write a recommendation to the partners justifying a short-term investment of business funds at this time, recommending one of these investments. include your analysis from questions 1 and 2 in your recommendation.

 

Paper#18823 | Written in 18-Jul-2015

Price : $44
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