What will be the value of her investment

Assignment Help Financial Management
Reference no: EM131187974

If the business manager deposits $200 in a savings account at the end of each year for twenty years what will be the value of her investment:

a) at a compounded rate of 10%?

b) at a compounded rate of 20%?

c) What would the outcome be if the deposits were made at the beginning of each year?

Reference no: EM131187974

Questions Cloud

The value of this mining operation is closest : You are thinking about investing in a mine that will produce $10,000 worth of ore in the first year. As the ore closest to the surface is removed it will become more difficult to extract the ore. Therefore, the value of the ore that you mine will dec..
The amount of money in your savings account : Since your first birthday, your grandparents have been depositing $1,000 into a savings account on every one of your birthdays. The account pays 4% interest annually. Immediately after your grandparents make the deposit on your 18th birthday, the amo..
What is the total amount of taxes paid : A C corporation earns $8.30 per share before taxes. The corporate tax rate is 39%, the personal tax rate on dividends is 15%, and the personal tax rate on non-dividend income is 36%. What is the total amount of taxes paid if the company pays a $6.00 ..
Annual basis to meet the equity portion of replacement cost : Your nursing home board wishes to determine the amount of funds they should set aside annually to meet eventual replacement cost needs. The facility has a current cost of $6,000,000 and will be replaced in 20 years. If 70 percent of the replacement c..
What will be the value of her investment : If the business manager deposits $200 in a savings account at the end of each year for twenty years what will be the value of her investment:
Use those values to compute the critical ratio : Land’s End is deciding how many sunglasses to order from a small manufacturer. One option under consideration would have the manufacture sell the sunglasses to Land’s End for $65 and credit Land’s End $53 for each unit left unsold and returned at the..
Stock has an annual return mean and standard deviation : DW Co. stock has an annual return mean and standard deviation of 10 percent and 31 percent, respectively. What is the smallest expected loss in the coming year with a probability of 2.5 percent?
What is the smallest expected loss for your portfolio : Tyler Trucks stock has an annual return mean and standard deviation of 13.5 percent and 47 percent, respectively. Michael Moped Manufacturing stock has an annual return mean and standard deviation of 12.2 percent and 47 percent, respectively. What is..
The optimal sharpe ratio in portfolio of the two assets : You are constructing a portfolio of two assets, Asset A and Asset B. The expected returns of the assets are 14 percent and 17 percent, respectively. The standard deviations of the assets are 40 percent and 48 percent, respectively. The correlation be..

Reviews

Write a Review

Financial Management Questions & Answers

  What is the present value of this security

You own a security that provides an annual dividend of $135 forever. The security’s annual return is 5%. What is the present value of this security? Round your answer to the nearest cent.

  What is the company total book value of debt

Jiminy's Cricket Farm issued a 30-year, 7 percent semi-annual bond 5 years ago. The bond currently sells for 81 percent of its face value. The book value of the debt issue is $23 million. The company's tax rate is 33 percent. What is the company's to..

  Apply IRR rule for capital budgeting decision in this case

You have an investment project that has two IRRs: 5% and 15%. Your required rate of return is 20%. What should you do? Please Explain. Your company considers several independent projects. All of them have normal cash flows. Will it be correct to appl..

  What is the companys current stock price

The Francis Company is expected to pay a dividend of D1 = $1.25 per share at the end of the year, and that dividend is expected to grow at a constant rate of 6.00% per year in the future. Francis cost of equity is 10.33%. What is the company's curren..

  Determine the premium of european call option mentioned

A European call option allows one to purchase 2 shares of stock B with 1 share of stock A at the end of a year. A European put option which allows one to sell 2 shares of stock B for 1 share of stock A costs 11.5. Determine the premium of the Europea..

  What is the economic ordering quantity

Fisk Corporation is trying to improve its inventory control system and has installed an online computer at its retail stores. Fisk anticipates sales of 49,000 units per year, an ordering cost of $2 per order, and carrying costs of $1.60 per unit. Wha..

  What are the required annual beginning-of-year lease payment

Ajax desires to earn a 12 percent after-tax rate of return on this lease. What are the required annual beginning-of-year lease payments?

  Calculate the annual cost of each of the three accounts

Judith Bao is a registered nurse who earns $3,250 per month after taxes. She has been reviewing her savings strategies and current banking arrangements to determine if she should make any changes. Calculate the annual cost of each of the three accoun..

  Food store is planning a major expansion

The Food Store is planning a major expansion for four years from today. In preparation for this, the company is setting aside $35,000 each quarter, starting today, for the next four years. How much money will the firm have when it is ready to expand ..

  Used to discount a projects expected cash flows

Real options change the size, but not the risk, of projects' expected NPVs. Real options change the risk, but not the size, of projects' expected NPVs. Real options can reduce the cost of capital that should be used to discount a project's expected c..

  Retirement or lottery

Retirement or Lottery-John is 25 years old and wishes to retire in 30 years. His plan is to invest in a mutual fund earning a 12 percent annual return and have a $1 million retirement fund at age 55. How much must he invest at the end of each year to..

  Discount rate on investment

You are being offered an investment that will pay you (and your heirs) $19,853 per year forever, starting 16 years from now. If your discount rate on this investment is 5.8 percent, how much would you be willing to pay for it 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