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Quiz: Time Value of Money

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Question;Question 3How many years it will take to grow your money from $3,284 to $7,572 if you can earn an interest of 5% compounded monthly? Note: Do not write "years" in your answer. Simply write the number in the answer box.1 points Question 4What should you be willing to pay in order to receive $712 annually forever, if you require 8% per year on the investment?Just enter the number up to 2 decimal points. Do not enter $ in the answer box.1 points Question 5What is the future value of annual payments of $1,284 for 16 years at 5 percent?1 points Question 6What is the future value of quarterly payments of $673 for 19 years at 6 percent?1 points Question 7Today, you are purchasing a $2,507 7-year car loan at 5 percent. You will pay annually at the end of each year. What is the amount of each payment?1 points Question 8How much do you need to invest today in order to have $4,371 at the end of 13 years if you are sure to earn an interest at the rate of 6%, if interest is compounded quarterly? Note: Do not put $ sign in your answer. Simply write the number in the answer box.1 points Question 9If the effective rate is 7%. What is the nominal rate if compounding is daily. Do not enter the symbol % in your answer. Simply enter the answer in percentages rounded off to two decimal points.1 points Question 10What is the future value of $2,226 invested for 16 years at 17% if interest is compounded semi-annually? Note: Do not put $ sign in your answer. Simply write the number in the answer box.1 points Question 11What is the future value of $2,115 invested for 18 years at 18% if interest is compounded semi-annually (twice a year)? Note: Do not put $ sign in your answer. Simply write the number in the answer box.1 points Question 12Kelly starting setting aside funds 5 years ago to buy some new equipment for her firm. She has saved $827 each quarter and earned an average rate of return of 6 percent. How much money does she currently have saved for this purpose?1 points Question 13What is the future value of $3,990 invested for 10 years at 11% if interest is compounded quarterly? Note: Do not put $ sign in your answer. Simply write the number in the answer box.1 points Question 14Assume interest rate of 5%. A company receives cash flows of $117,708 at the end of years 4, 5, 6, 7, and 8, and cash flows of $205,939 at the end of year 10. Compute the future value of this cash flow stream.Do not enter the symbol $ in your answer. Simply enter the answer rounded off to two decimal points.1 points Question 15Gertrude Carter and Co. has an outstanding loan that calls for equal annual payments of $14,903 over the 10-year life of the loan. The original loan amount was $100,000 at an APR of 8 percent. How much of the third payment is interest?Do not enter the symbol $ in your answer. Simply enter the answer rounded off to two decimal points.1 points Question 16Consider a 10-year loan with monthly payments at 10%. If the loan amount is $250,000, compute the Interest paid during the 6th year.Enter your answer rounded off to two decimal points. Do not enter $ in the answer box.1 points Question 17Barrett Pharmaceuticals is considering a drug project that costs $175,337 today and is expected to generate end-of-year annual cash flows of $11,818, forever. At what discount rate would Barrett be indifferent between accepting and rejecting the project? Just enter the number in percentages up to 2 decimal points. Do not enter % in the answer box.1 points Question 18023A:If you can double your money in 15 years, what is the implied annual rate of interest, given that compounded semi-annually? Note: give your answer in percentages. Note: Do not put % sign in your answer. Simply write the number in percentages in the answer box.1 points Question 19If you can double your money in 22 years, what is the implied annual rate of interest, given that compounded in quarterly? Note: give your answer in percentages. Note: Do not put % sign in your answer. Simply write the number in percentages in the answer box.1 points Question 20The ABC Company is considering a new project which will require an initial cash investment of $19,700. The projected cash flows for years 1 through 4 are $6,908, $8,216, $9,362, and $4,015, respectively. If the appropriate discount rate is 10%, compute the NPV of the project.Enter your answer rounded off to two decimal points. Do not enter $ in the answer box.1 points Question 21Assume interest rate of 6%. Suppose that you receive $97,408 at the end of each year for 4 years. Suppose that this cash flow starts at the end of the fourth year. Compute the present value.Do not enter the symbol $ in your answer. Simply enter the answer rounded off to two decimal points.1 points Question 22The ABC Company is considering a new project which will require an initial cash investment of $6,055. The project will produce no cash flows for the first 5 years. The projected cash flows for years 6 through 9 are $3,405, $2,850, $4,718, and $5,248, respectively. If the appropriate discount rate is 7%, compute the NPV of the project.Enter your answer rounded off to two decimal points. Do not enter $ in the answer box.1 points Question 23How many months it will take to grow your money from $3,912 to $7,196 if you can earn an interest of 13% compounded monthly? Note: Do not write "months" in your answer. Simply write the number in the answer box.1 points Question 24What is the future value of $7,256 for 9 years at 3 percent if interest is compounded semi-annually? Note: Do not enter "$" in your answer. Simply write down the number that you get as your answer.1 points Question 25In order to buy a house, you take a loan of 100,000 at 7.5% for a period of 13 years. Compute the balance remaining at the end of 5 years.Do not enter the symbol $ in your answer. Enter your answer as a positive number. Simply enter the answer rounded off to two decimal points.1 points Question 26Assume interest rate of 10%. A company receives cash flows of $534 at the end of year 5, $213 at the end of year 7, and $912 at the end of year 10. Compute the future value of this cash flow stream.Do not enter the symbol $ in your answer. Simply enter the answer rounded off to two decimal points.1 points Question 27How much do you need to invest today in order to have $14,116 at the end of 20 years if you are sure to earn an interest at the rate of 14%? Note: Do not put $ sign in your answer. Simply write the number in the answer box.1 points Question 28How many years it will take to grow your money from $4,619 to $9,223 if you can earn an interest of 7% compounded quarterly? Note: Do not write "years" in your answer. Simply write the number in the answer box.1 points Question 29027:Say, you deposit $3,710 in a bank for 19 years. What is the amount you will have in the bank at the end of 19 years if interest of 7 % compounded monthly for first 6 years and interest of 7 % compounded quarterly for the remaining years? Note: Do not put $ sign in your answer. Simply write the number in the answer box.1 points Question 30How many years it will take you to quadruple (means 4 times) your money if you can earn 13.09% each year? Note: Do not write "years" in your answer. Simply write the number in the answer box.1 points Question 31How many years it will take you to double your money if you can earn 14% each year, given that compounding is quarterly? Note: Do not write "years" in your answer. Simply write the number in the answer box.1 points Question 32The Perpetual Life Insurance Co is trying to sell you an investment policy that will pay you and your heirs $14,573 per year forever. Suppose the Perpetual Life Insurance Co. told you the policy costs $173,245. At what interest rate would this be a fair deal? Just enter the number in percentages up to 2 decimal points. Do not enter % in the answer box.1 points Question 33If you can triple your money in 18 years, what is the implied rate of interest? Note: Do not put % sign in your answer. Simply write the number in percentages in the answer box..1 points Question 34If you receive $412 at the end of each year for the first three years and $601 at the end of each year for the next three years. What is the present value? Assume interest rate is 5%.Hint: This is an uneven cash flow problem. Use the CF function and solve for NPV to get the answer.Just enter the number up to 2 decimal points. Do not enter $ in the answer box.1 points Question 35026:Say, you deposit $3,302 in a bank for 17 years. What is the amount you will have in the bank at the end of 17 years if interest of 5 % for first 7 years and interest of 7 % for the remaining years? Note: Do not put $ sign in your answer. Simply write the number in the answer box.1 points Question 36How much do you need to invest today in order to have $743 at the end of 21 years if you are sure to earn an interest at the rate of 9%, if interest is compounded monthly? Note: Do not put $ sign in your answer. Simply write the number in the answer box.

 

Paper#49339 | Written in 18-Jul-2015

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