Computation of amount to be invested each year

Assignment Help Finance Basics
Reference no: EM1310748

Computation of Amount to be invested each year for a target future value and Net Present Value of alternate investment options.

1. Susan Robinson is planning for her retirement. She is 30 years old today and would like to have $600,000 when she turns 55. She estimates that she will be able to earn a 9 percent rate of return on her retirement investments over time; she wants to set aside a constant amount of money every year ( at the end of the year) to help achieve her objectives. How much money must Robinson invest at the end of each of the next 25 years to realize her goal of $600,000 at the end of that time?

2. Two investment opportunities are open to you: Investment 1 and Investment 2. Each has an initial cost of $10,000. Assuming that you desire a 10 percent return on your initial investment, compute the net present value of the two alternatives and evaluate their relative attractiveness:

Investment 1

Investment 2



Cash Flows


















Reference no: EM1310748


Write a Review


Finance Basics Questions & Answers

  Computation of future annual receipts considering inflation

Computation of future annual receipts considering inflation rate and what annual income should he plan to receive in the first year of retirement in order to maintain the purchasing power on $20,000

  Computing weighted-average direct manufacturing labour rate

By using above information, what weighted-average direct manufacturing labour rate must you use in making your manufacturing direct labour cost objective?

  Cost of equity capital using arithmetic average growth rate

If stock presently sells for= $50, what is your best estimate of company’s cost of equity capital by using arithmetic average growth rate in dividends?

  Depository financial institution

Create balance sheet for this depository financial institution. Describe fully with suitable reasons for your choice.

  Iron company sells its irons

Suppose that discount rate is 10% each year, there is no possibility of repeat order, also Q will pay either in full or not at all.

  Trustee in bankruptcy announced that stock was valueless

Trustee in bankruptcy announced that stock was valueless also that even some of its favoured creditors would not be paid.

  Performing dupont analysis on project

Is this project in division manager’s best interests? Explain why or why not? Carry out DuPont Analysis on this project. Determine the project’s residual income?

  Lender - borrower relationship

The following questions are focused on a specific Lender / Borrower relationship

  Computation of book value per share

Compute the book value per share based on the reported stockholders' equity account for Bridgford Foods in fiscal year

  Computational fluid dynamics

Question on  Computational Fluid Dynamics,    What do your simulations derive the drag coefficients to be? Explain any discrepancies as best as you can.

  Determining firm-s quality initiatives

Do you believe this firm’s quality initiatives have been successful? Make sure to give explanation for your opinion with specific information.

  Case analysis: outdoor sports inc

Calculate the Du Pont ratio analysis

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