Finance Assignment - 1755 Words

Assignment 1 Q1.) (5 points) $50 today is worth MORE than $50 tomorrow.(Tell True or False) Q2.) $100 invested for 10 years at 12% interest is worth more in FV terms than $200 invested for 10 years at 4% interest. (Tell True or False) Q3.) Shawn wants to buy a new telescope. He estimates that it will take him one year to save the money and that the telescope will cost $200. At an interest rate of 6%, how much does Shawn need to set aside today to purchase the telescope in one year? Q4.)Johnny and Darren both earn $100 working on their respective neighbors big farms. Johnny puts his $100 in the piggy bank that his parents gave him to encourage him to save. Darren puts his money in a savings account his parents set up for him. The savings†¦show more content†¦The stated annual interest rate is 12%, but interest is compounded monthly and he will make monthly payments. The effective annual interest rate (EAR) of the loan is less than 12%. True False Question 2 (5 points) Gloria is 35 and trying to plan for retirement. She has put a budget together and plans to save $4,800 per year, starting at the end of this year, in a retirement fund until she is 65. Assume that she can make 7% on her account. How much will she have for retirement at age 65? 499245 144000 453412 345514 Question 3 (5 points) Dominique has just turned 65 and she has deposited her annual payment of $20,000 into her retirement account. She made her first such saving deposit into this fund on her 35th birthday. Dominique has also retired and wants to figure out how much money she has in her retirement account for her retired life. You are Dominiques friend who knows finance. How much is Dominiques savings worth today given that the fund has earned an annual return of 5.5%? (Enter just the number without the $ sign or a comma; round off decimals.) Answer for Question 3 Question 4 (5 points) Marcel has just graduated from college and has found a job that will pay him $25,000 per year at the end of each year, but the job is only for 5 years. He is not worried about that because he plans to do an MBA after gaining 5 years experience anyway. What is the value today of his 5-year salary assuming that the interest rate is 3%?Show MoreRelatedFinance Assignment1538 Words   |  7 Pages1 Question 1 (16 points) Carol Inc is considering the following three prices to charge customers for each of the candy packets they produce: i) $2.20 ii) $2.00 iii) $1.70 The relevant data for decision-making is below: Fixed Costs = $1200 Variable Costs = $0.50 per unit Calculate the following: a) The Breakeven Point for each price level b) Using price of $2.20 what would be the new breakeven point if (1) fixed costs decreased to $1000 all else remaining the same, (2) Variable costs increased toRead MoreEntrepreneurial Finance Assignment 12511 Words   |  11 PagesEntrepreneurial finance assignment 1 Problem 4.4. Introduction The CAPM model can be used to analyze the performance of a portfolio of investments. 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