What is the maximum you would be willing to pay for this

Assignment Help Financial Management
Reference no: EM132014156

Suppose that you are offered an investment that is expected to pay you $1000 in 1 year, $3000 in 2 years, $3000 in 3 years, and $5000 in 4 years. Your opportunity cost is 10%.

What is the maximum you would be willing to pay for this investment?

Reference no: EM132014156

Questions Cloud

Administration of insulin when treating dka : What are some serious adverse events that may result from the over-zealous administration of insulin when treating DKA?
How much will you need to pay : After 10 years, you win the lottery and want to pay off the rest of what you owe. How much will you need to pay?
How much will you have to save each year : Given you have access to a savings account that pays 6 percent interest that compounds annually, how much will you have to save each year?
Attempt to shoot an apple from the top : William Tell had only one attempt to shoot an apple from the top of his son's head with his bow and arrow.
What is the maximum you would be willing to pay for this : Suppose that you are offered an investment that is expected to pay you $1000 in 1 year, $3000 in 2 years, $3000 in 3 years, and $5000 in 4 years.
Chemical processes used to convert iron ore : What are the chemical processes used to convert iron ore into "pig iron" on a commercial scale?
Does covered interest parity hold in this example : Calculate the Korean investor's actual return, assuming that he invests in Japanese deposits in November 2016.
Fully saturated fat and a poly-unsaturated fat : What is the difference between a fully saturated fat and a poly-unsaturated fat? How does one convert poly-unsaturated fats into saturated fat?
Calculate the horizon value of the target : Calculate the value of the debt tax shield.Why do the target's free cash flows vary from one acquirer to another?

Reviews

Write a Review

Financial Management Questions & Answers

  Blockbuster had very little data on their customers

Compared to Netflix, Blockbuster had very little data on their customers, or understanding of their preferences or behaviors.

  Chains in-house instead of purchasing them from supplier

what is the net present value of the decision to produce the chains in-house instead of purchasing them from the supplier?

  What would be the total return of the bond in dollars

A 6.60 percent coupon bond with 15 years left to maturity is priced to offer a 5.3 percent yield to maturity. You believe that in one year, the yield to maturity will be 6.0 percent. What would be the total return of the bond in dollars? What would b..

  When the policy matures what would the value of the deposits

An insurance company is offering a new policy to its customers. Typically the policy is bought by a parent or grandparent for a child at the child's birth.

  Value of share is equal to present value of future earnings

The value of a share is equal to the present value of all future earnings (EPS). All else equal, if stock A's dividends grow at a higher rate than stock B's dividends, A is valued higher than B. P/E ratio is also called earnings multiple because P = ..

  What is the price and bond equivalent yield

A Treasury bill that settles on May 18, 2012, pays $100,000 on August 21, 2012. Assuming a discount rate of 5.41 percent, what is the price and bond equivalent yield? Use Excel to answer this question.

  What is the stock expected price two years from today

A stock is expected to pay a dividend of $1.00 at the end of the year. what is the stock's expected price 2 years from today?

  Initial investment in fixed assets when evaluating project

What is the proper cash flow amount to use as the initial investment in fixed assets when evaluating this project? Why?

  When the rate of return is equal to the discount rate

When the rate of return is equal to the discount rate..

  What is the internal rate of return on the project

What is the internal rate of return on the project ? What is the net present value of the project ?

  What about the worst- case scenario

What values should the company use for the four variables given here when it performs its best-case scenario analysis? What about the worst- case scenario?

  Derive the price of preferred stock

Derive the price of the preferred stock in the 2 cases where it is callable and in 5 years when it becomes non-callable.

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