What is the maximum lump sum payment you are willing to make

Assignment Help Finance Basics
Reference no: EM13295174

You have the opportunity to buy 6 end-of-year annual shipments of raw materials worth $20,000 each for your production facility. You must make the purchase today to begin receiving these shipments 365 days from today. Your vendor tells you that you will receive 10% annual interest on your money if you purchase the shipments today. What is the maximum lump sum payment you are willing to make today to buy these six future annual shipments?

Reference no: EM13295174

Questions Cloud

Find magnitude of kinetic friction force acting on childe : A 30kg child slides down a playground slide at a constant speed. find the magnitude of the kinetic friction force acting on the child
How to calculate the molar enthalpy change : Calculate the molar enthalpy change ?H~rxn for the dissolution of KNO3 in water. Calculate in the error in ?H~
Estimate the firm external financing needs : Estimate the firm's external financing needs by using the percent-of-sales method for the 2012 data. Assume that no excess capacity exists and that one-half of the 2012 net income will be retained in the business.
Determine the magnetic force on the bolt : An iron bolt of mass 70.0 g hangs from a string 35.2 cm long. The top end of the string is fixed. Find the magnetic force on the bolt
What is the maximum lump sum payment you are willing to make : What is the maximum lump sum payment you are willing to make today to buy these six future annual shipments?
Estimate the effective spring constant of the molecule : A molecule of DNA (deoxyribonucleic acid) is 2.08 µm long. The ends of the molecule become singly ionized: negative on one end, Determine the effective spring constant of the molecule
Define mass of the limiting reactant in the salt mixture : The drying oven, although thought (and assumed) to be set at 125 degrees C, had an insie temperature of 84 degrees C. How will this error affect the reported percent by mass of the limiting reactant in the salt mixture
What industrial and national capital structure pattern : What industrial and national capital structure patterns are exhibited globally? What factors seem to be driving these patterns?
What is the impact of a stock repurchase on a company : What is the impact of a stock repurchase on a company's debt ratio? Does this suggest another use for excess cash?

Reviews

Write a Review

Finance Basics Questions & Answers

  What is the firm optimal capital budget

The firm's corporate cost of capital is 14 percent. project cost irr a $20000 17% b $15000 16% c $12000 15% d $18000 13% a. What is the firm's optimal capital budget?

  What was the percentage gain or loss on the investment

The price of the stock subsequently fell to $38 before rising to $49 at which time Graham covered the position that is closed the short position. What was the percentage gain or loss on the investment. Please explain.

  Is her husbands comment correct or incorrect

XYZ stock has the same expected return and SD as the ABC stock. Her husband comments, "it doesn't matter whether you keep all of ABC stock or replace it with $100,000 of XYZ stock". Is her husband's comment correct or incorrect?

  What is the appropriate discount rate for your project?

What is the appropriate discount rate for your project? What would be the required rate of return of your shareholders from this project?

  Formulating a strategic plan

The strategic planning process, taken as a whole, has been positively associated with financial performance. Once comfortable with the materials in the assigned readings please conduct additional research.

  What was the market risk premium during these 10 years

The average annual return on the S& P 500 Index from 1986 to 1995 was 15.8 percent. The average annual T- bill yield during the same period was 5.6 percent. What was the market risk premium during these 10 years?

  Find the current value of a share

General Cereal common stock dividends have been growing at an annual rate of 7% per year over the last ten years. Current dividend is 1.70 each share.

  What is the size of the money multiplier

Assume a financial system has a monetary base of $25 million. The required reserves ratio is 10 percent and there are no leakages in the system.

  Which stock is riskier for a diversified investor

Stocks coefficient of variation, required rate return and risk analysis - Determine each stock's coefficient of variation and Which stock is riskier for a diversified investor?

  What was the dealers gain or loss on the change of rates

The FX rate for the yen was 142 yen per dollar at the time of purchase, but then rose to 171.8 yen by the time payment was made. What was the dealer's gain or loss on the change of rates?

  Calculating financial ratios

Just Dew It Corporation reports the following balance sheet data for 2004 and 2005. Based on the given balance sheets, calculate the following financial ratios for every year. Negative amount should be indicated by a minus sign.

  Calculate the net cash provided by the company financing

Calculate the net cash provided by the company's financing activities.

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