Calculate nominal interest rate, Taxation

You have been offered a unique investment opportunity today; you will receive $500 one year from now. If you invest $10,000 today, you will receive $500 one year from now, $1500 two years from now, and $10,000 ten years from now?

a) What is the NPV of the opportunity if the interest rate is 6%?  Should you take the opportunity?

b) What is the NPV of the opportunity if the interest rate is 2% per year? Should you take it now?

What is the present value of $1000 paid at the end of each of the next 100 years if the interest rate is 7% per year?

You have found there investment choices for a one- year deposit: 10% APR compounded monthly, 10% APR compounded annually, and 9% APR compounded daily. Compare the EAR for each for each investment choice. (Assume that there are 365 days in the year.)

Oppenheimer Bank is offering a 30-year mortgage with an EAR of 53/8% .If you plan to borrow $150,000, what will your monthly payment be?

If the rate of inflation is 5%, what nominal interest rate is necessary for you to earn a 3% real interest rate on your investment?

Your best taxable investment opportunity has an EAR of 4%. Your best tax-free investment opportunity has an EAR of 3%.  If your tax rate is 30%, which opportunity provides the higher after-tax interest rate?

Posted Date: 3/4/2013 7:49:43 AM | Location : United States







Related Discussions:- Calculate nominal interest rate, Assignment Help, Ask Question on Calculate nominal interest rate, Get Answer, Expert's Help, Calculate nominal interest rate Discussions

Write discussion on Calculate nominal interest rate
Your posts are moderated
Related Questions
Net Salvage Value Allen Air Lines must liquidate some equipment that is being replaced. The equipment originally cost $24 million, of which 80% has been depreciated. The used

Gustav Ltd commenced operations on 1 July 2011 and presents its first statement of comprehensive income for the year ending 30 June 2012 and first statement of financial position a

In May of the current year, your employer received a PIER report from the CRA that identified Canada Pension Plan (CPP) contribution deficiencies for employees in the organization

Critically Evaluate overseas experiences with this form of tax. (e.g. UK or Australia)

I have the whole case and this is the question (Canadian Taxation) Compute Net Income, Taxable Income and Net Federal Tax Payable for 2012 for Sandra, Steven, Annabelle and Ronnie

"Alfred E. Old and Beulah A. Crane, each age 42, married on September 7, 2010. Alfred and Beulah will file a joint return for 2011. Alfred''''s Social Security number is 111-11-111

Just moved out of state. My husband works 3 part time jobs instead of one full time job. Can we deduct our moving expenses?

I WOULD LIKE TO KNOW ABOUT GST. FROM WHERE IT HAVE COME AND HOW IT WORKS. ALSO INFORM ME WEATHER IT IS APPLICABLE IN INDIA OR NOT.

Thomas Crown expects to earn the following stream of annual income for the next four years:- $41,000; $45,000; $38,000 and $50,000. Although he has adopted the ‘Pay Yourself Firs

BBQ Beach corporation manufactures inflatable air-matresses and life jackets for summer fun. the firm is considering replacement of their existing production line (CCA Class 8, d=2