You just purchased a parcel of land for $47,000. To earn a 13% annual rate of...
You just purchased a parcel of land for $47,000. To earn a 13% annual rate of return on your investment, how much must you sell the land for in 4 years? Assume annual compounding. (Round to nearest penny, e.g. 1234.56)
Homework Answers
Present value = Future value/(1+i)^n
i = interest rate per period
n= number of periods
Future value = 47000 * (1+13%)^4
= 76632.26
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You just purchased a parcel of land for $47,000. To earn a 13%
annual rate of...
Question 2 i. You just purchased a parcel of land for $10,000. If you expect a 12% annual rate of return on you...
Question 2 i. You just purchased a parcel of land for $10,000. If you expect a 12% annual rate of return on your investment, how much will you sell the land for in 10 years? If you want to have $875 in 2.67 years, how much money must you put in a savings account today? Assume that the savings account pays 16% and it is compounded monthly. (2.5+2.5=5 marks)
Question 1 (0.2 points) You just purchased a parcel of land for $70000. If you expect...
Question 1 (0.2 points) You just purchased a parcel of land for $70000. If you expect to earn a 5% annual rate of return on it, how much do you expect to be able to sell it for in 10 years? Your Answer: Answer Hide hint for Question 1 Method 1: Future value of the land- current price (1-annual rate of return) (number of years); Method 2: on your financial calculator N-number of years Answer Hide hint for Question 1...
2) What is the present value of $12.500 to be received 10 years from today? Assume...
2) What is the present value of $12.500 to be received 10 years from today? Assume a discount rate of 8% compounded annually and round to the nearest $10 3) You just purchased a parcel of land for $10,000. If you expect a 12% annual rate of retum on your investment, how much will you sell the land for in 10 years? 12.51 4) If you want to have $875 in 2.67 years, how much money must you put in...
The YTM on a bond is the interest rate you earn on your investment if interest...
The YTM on a bond is the interest rate you earn on your investment if interest rates don’t change. If you actually sell the bond before it matures, your realized return is known as the holding period yield (HPY). a. Suppose that today you buy a bond with an annual coupon of 6 percent for $1,080. The bond has 13 years to maturity. What rate of return do you expect to earn on your investment? Assume a par value of...
The YTM on a bond is the interest rate you earn on your investment if interest...
The YTM on a bond is the interest rate you earn on your investment if interest rates don't change. If you actually sell the bond before it matures, your realized return is known as the holding period yield (HPY). a. Suppose that today you buy a bond with an annual coupon rate of 6 percent for $1,080. The bond has 13 years to maturity. What rate of return do you expect to earn on your investment? Assume a par value...
Question 23 (4 points) Suppose you borrowed $35000 at a rate of 11 percent and must...
Question 23 (4 points) Suppose you borrowed $35000 at a rate of 11 percent and must repay it in equal installments at the end of each of the next 5 years. How much interest would you have to pay in the first year? Your Answer: Answer units Question 24 (4 points) Consider the following stream of cash: Year Cash Flow a uewn 1000 1000 1000 4000 -4000 If your opportunity cost is 9 percent per year, how much should you...
The YTM on a bond is the interest rate you earn on your investment if interest...
The YTM on a bond is the interest rate you earn on your investment if interest rates don’t change. If you actually sell the bond before it matures, your realized return is known as the holding period yield (HPY). a. Suppose that today you buy a bond with an annual coupon rate of 11 percent for $1,200. The bond has 19 years to maturity. What rate of return do you expect to earn on your investment? Assume a par value...
The YTM on a bond is the interest rate you earn on your investment if interest...
The YTM on a bond is the interest rate you earn on your investment if interest rates don't change. If you actually sell the bond before it matures, your realized return is known as the holding period yield (HPY). a. Suppose that today you buy a bond with an annual coupon of 10 percent for $1,050. The bond has 19 years to maturity. What rate of return do you expect to earn on your investment? Assume a par value of...
The YTM on a bond is the interest rate you earn on your inves tment if...
The YTM on a bond is the interest rate you earn on your inves tment if interest rates don't change. If you actually sell the bond before it matures, your realized return is known as the holding period yield (HPY). a. Suppose that today you buy a bond with an annual coupon rate of 10 percent for $1,050. The bond has 19 years to maturity. What rate of return do you expect to earn on your investment? Assume a par...
The YTM on a bond is the interest rate you earn on your investment if interest...
The YTM on a bond is the interest rate you earn on your investment if interest rates don't change. If you actually sell the bond before it matures, your realized return is known as the holding period yield (HPY). a. Suppose that today you buy a bond with an annual coupon rate of 11 percent for $1,060. The bond has 20 years to maturity. What rate of return do you expect to earn on your investment? Assume a par value...
Question 2 i. You just purchased a parcel of land for $10,000. If you expect a 12% annual rate of return on your investment, how much will you sell the land for in 10 years? If you want to have $875 in 2.67 years, how much money must you put in a savings account today? Assume that the savings account pays 16% and it is compounded monthly. (2.5+2.5=5 marks)
Question 1 (0.2 points) You just purchased a parcel of land for $70000. If you expect to earn a 5% annual rate of return on it, how much do you expect to be able to sell it for in 10 years? Your Answer: Answer Hide hint for Question 1 Method 1: Future value of the land- current price (1-annual rate of return) (number of years); Method 2: on your financial calculator N-number of years Answer Hide hint for Question 1...
2) What is the present value of $12.500 to be received 10 years from today? Assume a discount rate of 8% compounded annually and round to the nearest $10 3) You just purchased a parcel of land for $10,000. If you expect a 12% annual rate of retum on your investment, how much will you sell the land for in 10 years? 12.51 4) If you want to have $875 in 2.67 years, how much money must you put in...
The YTM on a bond is the interest rate you earn on your investment if interest rates don't change. If you actually sell the bond before it matures, your realized return is known as the holding period yield (HPY). a. Suppose that today you buy a bond with an annual coupon rate of 6 percent for $1,080. The bond has 13 years to maturity. What rate of return do you expect to earn on your investment? Assume a par value...
Question 23 (4 points) Suppose you borrowed $35000 at a rate of 11 percent and must repay it in equal installments at the end of each of the next 5 years. How much interest would you have to pay in the first year? Your Answer: Answer units Question 24 (4 points) Consider the following stream of cash: Year Cash Flow a uewn 1000 1000 1000 4000 -4000 If your opportunity cost is 9 percent per year, how much should you...
The YTM on a bond is the interest rate you earn on your investment if interest rates don't change. If you actually sell the bond before it matures, your realized return is known as the holding period yield (HPY). a. Suppose that today you buy a bond with an annual coupon of 10 percent for $1,050. The bond has 19 years to maturity. What rate of return do you expect to earn on your investment? Assume a par value of...
The YTM on a bond is the interest rate you earn on your inves tment if interest rates don't change. If you actually sell the bond before it matures, your realized return is known as the holding period yield (HPY). a. Suppose that today you buy a bond with an annual coupon rate of 10 percent for $1,050. The bond has 19 years to maturity. What rate of return do you expect to earn on your investment? Assume a par...
The YTM on a bond is the interest rate you earn on your investment if interest rates don't change. If you actually sell the bond before it matures, your realized return is known as the holding period yield (HPY). a. Suppose that today you buy a bond with an annual coupon rate of 11 percent for $1,060. The bond has 20 years to maturity. What rate of return do you expect to earn on your investment? Assume a par value...
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