What is payback period in whole number years for investment

Assignment Help Financial Management
Reference no: EM13849008

You invest $25,000 now and receive $3,000 per year for 25 years starting at the end of the first year. What is the payback period in whole number years for this investment? In other words, in what year do you break even on this investment? Use i = 8% annual rate compounded annually, and use the discounted payback approach (not simple payback).

Reference no: EM13849008

Questions Cloud

What conditions is physician-assisted suicide accceptable : Construct an argument for a position on the topic: Under what conditions is physician-assisted suicide morally accceptable
Treasury strip-use annual compounding of interest : A US Treasury STRIP with a face value of $1000 has 12 years to maturity. In excel, compute and graph the yields for prices of $400 to $1000, in $50 increments. Use annual compounding of interest.
What is the current market price of these bonds : Jackson Corporation's bonds have 5 years remaining to maturity. Interest is paid annually, the bonds have a $1,000 par value, and the coupon interest rate is 10.5%. The bonds have a yield to maturity of 8%. What is the current market price of these b..
How can you ensure a group is communicating effectively : In addition to the agenda, write a 200- to 350-word summary of the following: In a virtual meeting, how can you ensure a group is communicating effectively? How can you ensure that each team member understands what the next steps are required to achi..
What is payback period in whole number years for investment : You invest $25,000 now and receive $3,000 per year for 25 years starting at the end of the first year. What is the payback period in whole number years for this investment? In other words, in what year do you break even on this investment? Use i = 8%..
What is the estimated value of rolens preferred stock : Several years ago, Rolen Riders issued preferred stock with a stated annual dividend of 8% of its $100 par value. Preferred stock of this type currently yields 8%. Assume dividends are paid annually. What is the estimated value of Rolen's preferred s..
Equilibrium with required return equal to expected return : Simpkins Corporation does not pay any dividends because it is expanding rapidly and needs to retain all of its earnings. However, investors expect Simpkins to begin paying dividends, with the first dividend of $0.50 coming 3 years from today. what is..
Importance of creating a centralized blog site : The purpose of this unit is to learn about the ways podcasts can be used to establish a professional presence in the workplace. You will learn about the importance of creating a centralized blog site as a tool for digital communications. Finally, ..
What is the estimated value per share of your firms stock : Assume that the average firm in your company's industry is expected to grow at a constant rate of 5% and that its dividend yield is 6%. Your company is about as risky as the average firm in the industry and just paid a dividend (D0) of $2.5. What is ..

Reviews

Write a Review

Financial Management Questions & Answers

  What is ratio analysis

What is ratio analysis? Also briefly describe the three basic categories or ways that ratio analysis is used.

  How important is good governance and ethics for a firm

How important is good governance and ethics for a firm? Provide answers with examples and theoretical explanations.

  Present value of the remaining lease payments

ZXC has 20 annual lease payments remaining in its contract. The next one for $2.5m is due in 4 months. The payments decrease with the equipment value by 4% per year. Using a 12% discount rate, what is today’s present value of the remaining lease paym..

  Considering an opportunity that requires an investment

Nielson Motors is considering an opportunity that requires an investment of $1,000, 000 today and will provide $250,000 one year from now, $450,000 two years from now, and $650,000 three years from now.

  What is the present value of the tax shield

Carter's Home Supply has a $35 million bond issue outstanding with a coupon rate of 8.5 percent. The tax rate is 38 percent. What is the present value of the tax shield?

  Sales and projections indicate a return on invested capital

The SignPost has a WACC of 12%. They are contemplating growing their sales and projections indicate a return on invested capital (ROIC) of 9.5% as a result of the sales growth. The growth in sales: a) destroys value, b) adds value c) cannot be determ..

  Establish the preliminary performance targets

Establish the preliminary performance targets / level of service that will be required from the selected vendors; Establish the type of contract that you will use for each contract (i.e., fixed, cost-plus, reimbursable, unit); Determine the evaluatio..

  Financial leverage effects-return on invested capital

Firms HL and LL are identical except for their leverage ratios and the interest rates they pay on debt. Each has $30 million in invested capital, has $9 million of EBIT, and is in the 40% federal-plus-state tax bracket. Calculate the return on invest..

  Write about financial market in iceland

Write about Financial market in Iceland

  Suppose two years later from the original issuing date

XYZ Company is planning to issue some bonds. The bonds, with a $5,000 par value and the coupon rate of 12% will mature in 10 years. The interest will be paid semi annually. Suppose two years later from the original issuing date, the going rate in the..

  Market for exchange rates

Based on the volatility smile usually observed in the market for exchange rates, which of these estimates would you expect to be too low and which would you expect to be too high?

  What is the holding period return of a bond with a par value

What is the holding period return of a bond with a par value of $1,000 and a coupon rate of 8% if its price at the beginning of the year was $1,012 and its price at the end of the year is $1,047?

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