What is the fair price of this investment

Assignment Help Business Economics
Reference no: EM13737838

An investment pays $2,100 per year for the first 3 years, $4,200 per year for the next 8 years, and $6,300 per year the following 12 years (all payments are at the end of each year). If the discount rate is 8.75% compounding quarterly, what is the fair price of this investment?

Reference no: EM13737838

Questions Cloud

What two oligopoly models might offer an explanation : When an automaker begins offering low cost financing or rebates, others tend to do the same. What two oligopoly models might offer an explanation of this behavior? Fast-food restaurants tend to cluster together. That is, on one corner, there might be..
Command-and-control environmental laws : In the U.S., the command-and-control environmental laws of the early 1970s, together with the ensuing amendments and updates that have been made to them over time,
The average total cost curve must be rising : The Average Total Cost curve must be rising. The Average Total Cost curve must be below the Marginal Cost curve. The Average Total Cost curve must be above the Marginal Cost curve.
Show mathematically that for any upward sloping srmc : Show mathematically that for any upward sloping SRMC, SRATC is strictly convex, crosses the SRMC curve at the lowest point on the SRATC curve, and the SRMC curve is rising at that point.
What is the fair price of this investment : An investment pays $2,100 per year for the first 3 years, $4,200 per year for the next 8 years, and $6,300 per year the following 12 years (all payments are at the end of each year). If the discount rate is 8.75% compounding quarterly, what is the fa..
Minimum monthly payment : Suppose you owe $1400 on your credit card. The APR is 12%, compounded monthly. The credit card company says your minimum monthly payment is $20.84.
Assume the market for bagels is in equilibrium : Assume the market for bagels is in equilibrium.
What is the effective interest rate and the apr : Some lenders charge an up-front fee on a loan, which is subtracted from what the borrower receives. This is typically described as "points" (where one point equals 1% of the loan amount). The federal government requires that this be accounted for in ..
Multi domestic corporation or borderless organization : Is HSBC Global Corporation, Multi Domestic Corporation or borderless organization for its business in Japan? While HSBC claims that it is the world’s local bank, can it become a local bank in Japan? What should HSBC have done before they considered a..

Reviews

Write a Review

Business Economics Questions & Answers

  Income streams

Which of the following income streams will i choose if the interest raate is 50%:

  Q1 suppose that the first week of summer jenny charged 25

q1. suppose that the first week of summer jenny charged 25 cents for an 8-ounce cup of lemonade her next-door neighbor

  Considers a consumer who suddenly changes

Considers a consumer who suddenly changes her preferences with regard to air travel,

  What to spent on software-hardware to improve efficiency

An engineering company requested that $500000 be spent on software and hardware to improve the efficiency of some control systems.

  Explain oligopolies are always bad for society

Oligopolies are always bad for society. The beer industry has a few large firms and many small firms; therefore we would not call it an oligopoly.

  What is the implied income elasticity of demand for movies

he or she rents 63 movies per year at the same price per movie. What is the implied income elasticity of demand for movies? Are movies a normal good or an inferior good?

  Illustrate business cycle expansions

What is meant by "risk premium". Risk premiums on corporate bonds are usually anticyclical; that is, they decrease during business cycle expansions and increase during recessions. Why is this so.

  Loved one child more than the other

Gary has two children, Kevin and Dora. Each one consumes "yummiest" and nothing else. Gary loves both children equally.

  Illustrate what you would expect to find with the liquidity

Is your answer consistent with illustrate what you would expect to find with the liquidity preference framework.

  The largest loan that the bank can make

The largest loan that the bank can make on the basis of the new deposit. If the bank chooses to hold reserves of $3,000 on the new deposit, what are the excess reserves on the deposit.

  Consumer indifferent between iphone and galaxy

Suppose Apple sells phones with 4-inch screens and Samsung sells those 5-inch ones. Consumers have their hands of different sizes. Their most preferred sizes, as a result (that might depend on the probability that they drop their phones), are distrib..

  Question about social diversity

Determine what are some of the philosophies that influenced Latin America? In what way did they impact the cultures of Latin America?

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd