Edwards investments come in the form of equal annual

Assignment Help Finance Basics
Reference no: EM13576193

1) Edward wishes to save enough money to purchase a retirement lake cabin. He is willing to spend $500,000 for the cabin and he can save $25,000 per year and invest the money into an account earning 8.00% per year. If Edward's investments come in the form of equal annual end-of-the-year cash flows and the first cash flow is in exactly one year, how long will it take him to save enough money to buy the lake cabin?

a) Between 8 and 9 years.
b) Between 10 and 11 years.
c) Between 12 and 13 years.
d) Exactly 20 years.

2) An investment advisor has recommended a $70,000 portfolio containing assets R, J, and K; $25,000 will be invested in asset R, with an expected annual return of 12 percent; $10,000 will be invested in asset J, with an expected annual return of 18 percent; and $15,000 will be invested in asset K, with an expected annual return of 8 percent. The expected annual return of this portfolio is:

a) 12.67%
b) 12.00%
c) 10.00%

Reference no: EM13576193

Questions Cloud

Juliet needs to determine if her business will generate : juliet needs to determine if her business will generate enough cash to get through the end of the year. she expects
Compute the sample mean and standard deviation compute the : the following sample was obtained from a population with unknown parameters.scores 6 12 0 3 4a. compute the sample mean
Simple plant manufactures dna test strips manufacturing : simple plant manufactures dna test strips. manufacturing overhead is applied to unit produced using direct labor
A professional football players contract is sold at a gain : a professional football players contract is sold at a gain after it has been held for two years. what issues shoul the
Edwards investments come in the form of equal annual : 1 edward wishes to save enough money to purchase a retirement lake cabin. he is willing to spend 500000 for the cabin
What is the overall university-wide acceptance rate for men : question university admissionsthe dean of a university is worried about gender discrimination. despite having identical
The following selected account balances were taken from : the following selected account balances were taken from buckeye companys general ledger at january 1 2005 and december
Gomez service company paid their first installment on : gomez service company paid their first installment on their notes payable in the amount of 2000. how will this
On january 1 2008 abc company borrowed 200000 from the bank : on january 1 2008 abc company borrowed 200000 from the bank. the loan is a 10-year note payable that requires

Reviews

Write a Review

Finance Basics Questions & Answers

  Answer true or false to the following statements with a

answer true or false to the following statements with a short explanation. a. a stock that sells for less than book

  What is the estimated beta coefficient of your company

Do you feel that the three-stock portfolio is sufficiently diversified or does it still have risk that can be diversified away? Explain.

  What are the dangers associated with taking an old

what are the dangers associated with taking an old contract and merely changing the name of the supplier for use in a

  How many shares will the investor have at the end

An investor who buys 100 shares for $40 a share of stock that pays a per-share dividend of $2 annually signs up for the dividend reinvestment plan. If neither the price of the stock nor the dividend is changed, how many shares will the investor ha..

  Business help-capital structure

Describe the influence of taxes and bankruptcy costs on optimal capital structure. If you were the current CFO of Rite-Aid Pharmacy, how would these considerations guide your decision making in the near future as you consider RA's capital structur..

  What percentage of your income do you need to contribute to

You have just turned 30 years old, have just received your MBA, and have accepted your first job. Now you must decide how much money to put into your retirement plan. The plan works as follows: Every dollar in the plan earns 7% per year. You cannot m..

  Computing the present value of the mortgage loan

Computing the present value of the mortgage loan and How much do you owe on the mortgage

  How budget planning is related risk management

Explain how budget planning is related risk management for the RFP you have selected.

  Fountain corporation economists estimate that the

fountain corporation economists estimate that the probability of a good business environment next year is equal to the

  Computation and capital budgeting decision based on irr

Computation and capital budgeting decision based on IRR and should the project be accepted if it has been assigned a required return of 9.5%

  If after 6 months the homeowner experiences a casualty loss

the owner of a house worth 180000 purchases an insurance policy at the beginning of the year for a price of 1 000. the

  Calculate the imputed interest on a 10 year zero-coupon

calculate the imputed interest on a 10 year zero-coupon 1000 bond in its second year given a yield-to-maturity of

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