Annual stated rate that is compunded semi-annually

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1. You decide to save for your dream vacation to Europe (London, Paris, and Rome). You want to be able to travel in 5 years. If you believe your trip will cost $8,000 and you can earn 6 percent annual interest on your savings, how much must you deposit today so you can afford your trip in 5 years?

2. What is the effective annual rate (EAR) of an 8 percent annual stated rate that is compunded semi-annually?

3. Burns Industries has total sales of $300,000 and costs of $105,000 (Note: costs do not include depreciation expense). Depreciation expense is $25,000 and the tax rate is 35 percent. The firm does not have any interest expense. What is the operating cash flow (OCF)?

Reference no: EM132061453

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