Calculate the interest rate for investments

Assignment Help Financial Management
Reference no: EM131346248

You’re trying to choose between two different investments, both of which have up-front costs of $72,000. Investment G returns $132,000 in five years. Investment H returns $192,000 in 9 years.

Calculate the interest rate for investments G and H. (Do not round intermediate calculations and enter your answers as a percent rounded to 2 decimal places, e.g., 32.16)

                                        Interest rate

Investment G=

Investment H=

Reference no: EM131346248

Questions Cloud

Effective annual return friendly earns on lending business : Friendly’s Quick Loans, Inc., offers you “eight for ten or I knock on your door.” This means you get $8.00 today and repay $10.00 when you get your paycheck in one week (or else). If you were brave enough to ask, what APR would Friendly’s say you wer..
Saving for college education of two children : You are saving for the college education of your two children. They are two years apart in age; one will begin college 15 years from today and the other will begin 17 years from today. How much money must you, deposit in an account each year to fund ..
What is the present value of the offer : Tom Adams has received a job offer from a large investment bank as a clerk to an associate banker. His base salary will be $51,000. He will receive his first annual salary payment one year from the day he begins to work. What is the present value of ..
What is present value of the annuity : A 20-year annuity pays $1,900 per month, and payments are made at the end of each month. If the interest rate is 10 percent compounded monthly for the first seven years, and 9 percent compounded monthly thereafter, what is the present value of the an..
Calculate the interest rate for investments : You’re trying to choose between two different investments, both of which have up-front costs of $72,000. Investment G returns $132,000 in five years. Investment H returns $192,000 in 9 years. Calculate the interest rate for investments G and H.
Find the duration of a bond with settlement date : Find the duration of a bond with settlement date June 1, 2016, and maturity date November 25, 2025. The coupon rate of the bond is 8%, and the bond pays coupons semiannually. The bond is selling at a yield to maturity of 9%.
Long-term debt retirement obligations : The Danville Company is considering a $50 million expansion (capital expenditure) program next year. The company wants to determine approximately how much additional financing will be needed if the expansion program is undertaken. Long-term debt reti..
Find the convexity of seven-year maturity : Find the convexity of a seven-year maturity, 8.4% coupon bond selling at a yield to maturity of 9.4%. The bond pays its coupons annually.
Translated value of account receivable-inventory respectivey : The Herlitzka Company, a U.S. multinational firm, has a 100% stake in a Swiss subsidiary. The Swiss franc (SF) has been determined to be the functional currency. All the common stock of the subsidiary was issued at the beginning of the year and the s..

Reviews

Write a Review

Financial Management Questions & Answers

  The exchange rate-calculate the new direct quote

The exchange rate between South African rand (ZAR) and USD is R7.8789 per $1. Later, ZAR appreciates by 2.5%. Calculate the new direct quote.

  Invest using mutual funds or other investment companies

Why would it be a good idea to invest using mutual funds or other investment companies rather than investing directly by you?

  Produce table and graph for the price per barrel airlines

Imagine that Segal Air entered into a forward contract (forward price of $105) for half of their 2017 fuel needs and bought calls (strike of $120 and premium of $10). Produce the table and graph for the price per barrel the airlines will pay as a fun..

  Considering expanding operations to meet growing demand

A corporation is considering expanding operations to meet growing demand. With the capital expansion, the current accounts are expected to change. Management expects cash to increase by $20,000, accounts receivable by $40,000, and inventories by $60,..

  Expected return-what must the beta of this stock be

A stock has an expected return of 14.9 percent, the risk-free rate is 5.85 percent, and the market risk premium is 7.6 percent. What must the beta of this stock be? (Do not round intermediate calculations. Round your answer to 3 decimal places (e.g.,..

  Capital budgeting criteria-ethical considerations

An electric utility is considering a new power plant in northern Arizona. Power from the plant would be sold in the Phoenix area, where it is badly needed. Because the firm has received a permit, the plant would be legal; Calculate the NPV and IRR wi..

  Common stock is currently selling

Greens Company’s common stock is currently selling for $66 per share. Last year, the company paid dividends of $3.45 per share The projected growth rate of dividends for this stock is 3.56 percent. Which rate of return does the investor expect to rec..

  How much should the lease payments be

The Hardaway Corporation plans to lease a $810,000 asset to the O’Neil Corporation. The lease will be for 11 years. Use Appendix D for an approximate answer but calculate your final answer using the formula and financial calculator methods. how much ..

  Dividend growth rate-what will share of stock sell for today

Storico Co. just paid a dividend of $1.90 per share. The company will increase its dividend by 20 percent next year and will then reduce its dividend growth rate by 5 percentage points per year until it reaches the industry average of 5 percent divid..

  Present and future values for different interest rates

Present and future values for different interest rates-Find the following values. Compounding/discounting occurs annually. An initial $700 compounded for 10 years at 8%.

  What is the opportunity cost if julia purchases the new car

If Julia's groceries cost $50 per week and she estimates her other expenses to be $150 per month, how much will she have left each month to put toward savings to reach her financial goals?

  Annual effective interest rate based

You are taking $2000 loan. You will pay it back in four equal amounts, paid every 6 months staring three years from now. The annual nominal interest rate is 14% compounded semiannually. Calculate (a) The annual effective interest rate based on both s..

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