Q1 you have euro12 000 in cash you can deposit it today in

Assignment Help Finance Basics
Reference no: EM13355482

Q. 1) You have €12 000 in cash. You can deposit it today in the mutual fund earning 8.2% semi-annually, or you can stay, benefit from some of it, and invest €11 000 in your brother's business in 2 years. Your brother is assuring you a return of at least 10% on your investment. Either alternative you select, you will require to cash in at the end of ten years. suppose your brother is trustworthy and both investments carry similar risk.

2) Jack comes to a decision to purchase a car. He can also lease the car or buy it with the 3 year loan. Car he wants to purchase costs $45,000. Dealer has the special leasing arrangement where he pays $1 today and $650 per month at commencement of each month for next 3 years. If he purchases car, he will pay it off in monthly payments over next 3 years at an 10% annual percentage interest rate (APR) with monthly compounding. He also believes that he will be able to sell car for= $30,000 in 3 years.

Question: Compute the present value of the total costs if Jack decides to lease the car?

Reference no: EM13355482

Questions Cloud

This will provide you with insight on how others perceive : this will provide you with insight on how others perceive you. it will be particularly useful in situations in which
Question read the news article china trade barriers a : question read the news article china trade barriers a serious concern u.s.
Community board of realtors casenbspthe real estate : community board of realtors casenbspthe real estate business relies on an extensive amount of information used in the
Q 1 how determine the npv by using required rate of return : q. 1 how determine the npv by using required rate of return when there are no given cash flows? three year expansion
Q1 you have euro12 000 in cash you can deposit it today in : q.1 you have euro12 000 in cash. you can deposit it today in the mutual fund earning 8.2 semi-annually or you can stay
Qi would like to figure out the relevant cost in some cost : q.i would like to figure out the relevant cost in some cost flight operation salaries of flight crew fuel maintenance
Q1 it some respects karl marx could be thought of as one of : q1. it some respects karl marx could be thought of as one of the last of the classical economists. analyze this
Qconsider the application of the demand-revealing process : q.consider the application of the demand-revealing process to land assembly that we discussed in class. we defined d as
Q 1 why a favorable shock to the production function tends : q. 1. why a favorable shock to the production function tends to reduce the price level p. how could the monetary

Reviews

Write a Review

Finance Basics Questions & Answers

  How much does the second annuity pay each year

You are comparing two annuities with equal present values. The applicable discount rate is 8.75 percent. One annuity pays $5,000 on the first day of each year for 20 years. How much does the second annuity pay each year for 20 years if it pays at ..

  Computing investor-s average degree of risk aversion

The standard deviation of the market portfolio is 22%. What is the representative investor’s average degree of risk aversion?

  What is the value of an fra that enables the holder to earn

Q1) The 12-month, 15-month, 18-month zero rates are 7.4%, 7.5%, 7.6% with continuous compounding. What is the value of an FRA that enables the holder to earn 8.6% (with semiannual compounding) for a 6-month period starting in one year on a principal ..

  Would this proposal eliminate the exchange rate risk

Using the information in the previous question, consider a proposal to price the exports to Mexico in U.S. dollars and use the U. S. source for raw materials. Would this proposal eliminate the exchange rate risk? Why or why not?

  Computation of cost of equity using constant growth rate

Computation of cost of equity using constant growth rate and The constant growth rate dividend capitalization model approach

  How much was your mortgage reduced in the first year

How much interest did you pay in the first year and how much was your mortgage reduced in the first year?

  Which is the important factor

In determining the cost of bank financing, which is the important factor?

  What would happen to the monetary base

What would happen to the monetary base if the U.S. Treasury collected $4 billion in taxes, which it deposited in its account at the Fed, and the Fed bought $2.5 billion in government securities?

  How much would these bonds sell for today

Assume that Brady Corp. has an issue of 18-year $1,000 par value bonds that pay 7% interest, annually. Further assume that today's required rate of return on these bonds is 5%. How much would these bonds sell for today? Round off to the nearest $1

  What is the us dollar cost to hp of buying £50 million

Suppose HP receives quotes of ¥122.330-38 for the US dollar and ¥238.240-54 for pound.

  What is the rate of inflation

The yield to maturity on a bond is currently 8.46 percent. The real rate of return is 3.22 percent. What is the rate of inflation?

  What discount rate are investors using to value investment

Company Z is offering 2 possible investments with the same level of risk. Investment A is a perpetuity. with the first cash flow, of $100.00 per year, coming in one year - Which investment is more valuable today

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