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A stock investor deposited $1000 four years ago in a non-dividend paying stock




6. (3 points) A stock investor deposited $1000 four years ago in a non-dividend paying stock. Today the stock is valued at $814. What annual rate of return has this investor earned?;Rate;7. (8 points) A friend wants to retire in 30 years when he is 65. At age 35, he can invest $300/month that earns 6% each year. But he is thinking of waiting 15 years when he is age 50, and then investing $900/month to catch up, earning the same 6% per year. He feels that by investing three times as much for half as many years (15 instead of 30 years) he will have more. What is the future value of each of these options at age 65, and under which scenario would he accumulate more money?;Scenario A:, Scenario B:, Best;8. (4 points) Compute the present value of a one-time payment of $1,000 paid in four years using the following discount rates: 1.0% in year 1, 2.0% in year 2, 4% in year 3, and 3% in year 4.;Present Value;9. (5 points) TV?s R Yours is advertising a deal, in which you buy a flat screen TV for $4,769 (including tax) with one year before you need to pay (no interest is incurred if you pay by the end of the one year). How much would you need to deposit at the end of each month in a savings account earning 1.2% APR, compounded monthly, to be able to pay the $4,769 bill in one year? Monthly Deposit;10. (8 points) Instead, you opt to purchase a 10-Inch 4K Ultra HD 120Hz Smart LED TV for $149,980 (yes, it?s really there) by getting a loan for $120,980 and paying a $29,000 down payment. You can get a 10-year loan with a 3.6% interest rate.;A. What would be your monthly payment?;B. In 4 years, when a newer, cheaper but nicer TV is available, what would be the loan balance?


Paper#19448 | Written in 18-Jul-2015

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