Make monthly withdrawals

Assignment Help Finance Basics
Reference no: EM133061858

1. You have $320,000. You put it in an account for 10 years, then you make monthly withdrawals for the next 20 years. If interest earns 5.2% compounded semi-annually, what is the size of the monthly payment?(hint: this is a case of the deferred annuities ; monthly withdrawals to semi annual interest. So, you would use general annuities formula).

2. You invest in a company with a quarterly $1.25 dividend. If you require a return of 8% compounded semi-annually, what is the value of the shares? (hint: this is a general perpetuity case; use it to get the PV i.e. the value of the shares)

3. How much will you have 20 years from today if you deposit $2,000 at the end of this year, then increase your annual contributions by 2% thereafter? Interest is 5% compounded annually

Reference no: EM133061858

Questions Cloud

Evaluate performance of an equity fund : Discuss how you would use CAPM to evaluate performance of an equity fund given information on its "alpha" and "beta". Draw a graph to illustrate your answer.
What amount should be used as the initial cash flow : The building cost is estimated at $1,524,000. What amount should be used as the initial cash flow for this project
What is the expected return of a portfolio : Suppose Autodesk stock has a beta of 2.30?, whereas Costco stock has a beta of 0.68. If the? risk-free interest rate is 6.5% and the expected return of the mark
Which concept stands out to you as the most useful insight : Which concept stands out to you as the most useful insight that you have gained from this material that will influence your thinking as you progress towards you
Make monthly withdrawals : 1. You have $320,000. You put it in an account for 10 years, then you make monthly withdrawals for the next 20 years. If interest earns 5.2% compounded semi-ann
Construct an amortization table : You want to invest your annual salary which is LE1,000,000 in a mortgage loan to buy a property. Find a suitable property (it has to be a real property) and spe
Compute for the efficiency variance : For the month, the company purchased 100,000 yards of the direct material for P350,000. Compute for the efficiency variance
Assumptions of the gordon growth model : a. Define the shares, stocks and quota. b. Explain why equity is a residual claim?
Domestic income tax rate : You own 10 000 BAT shares. BAT announces a dividend re-investment plan giving shareholders the choice of electing • cash income at a rate of 50.75p per share, o

Reviews

Write a Review

Finance Basics Questions & Answers

  Financial reporting and analysis

Finance is about Gunns Ltd, a company in dealing with forestry products in Australia. The company has also been listed in Australian Stock Exchange. As many companies producing forestry products, even Gunns Ltd is facing various problems. Due to the ..

  A report on financial accounting

This report is specific for a core understanding for Financial Accounting and its relevant factors.

  Describe the types of financial ratios

Describe the types of financial ratios and other financial performance measures that are used during venture's successful life cycle.

  Differences between sole proprietorship and corporation

Briefly describe the major differences between a sole proprietorship and a corporation

  Prepare a cash budget statement

Calculate the expected value of the apartment in 20 years' time. What is the mortgage loan repayment at the beginning of each month

  What are the implied interest rates

What are the implied interest rates in Europe and the U.S.?

  State pricing theory and no-arbitrage pricing theory

State pricing theory and no-arbitrage pricing theory

  Small business administration

Identify the likely stage for each venture and describe the type of financing each venture is likely to be seeking and identify potential sources for that financing.

  Effect of financial leverage

The Effect of Financial Leverage and working capital management

  Evaluate the basis for the payment to the lender

Evaluate the basis for the payment to the lender and basis for the payment to the company-counterparty.

  Importance of opps, ipps, mpfs and dmepos

Research and discuss the differences and importance of : OPPS, IPPS, MPFS and DMEPOS.

  Time value of money

Time Value of Money project

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