User Account

All Pages

Compare value vs price to make a decision

Assignment Help Business Management
Reference no: EM132726085

You own two annuity investments and have a discount rate of 12% p.a.

Annuity 1 - This annuity has 6 semi-annual payments in advance, growing at 2% every 6 months. The first payment is $500.

Annuity 2 - This annuity pays $200 every quarter for 5 years.

You are offered $3,000 to sell any one of the investments.

Which investment will you sell (if any) and calculate the gain?

(Hint: Calculate the PV of each annuity and compare value vs price to make a decision. Remember you are looking to SELL here.)

Reference no: EM132726085

Questions Cloud

What is the price of the bond today : The face value of the bond is $300,000. The bond pays a coupon every quarter and the coupon rate is 10% p.a.. The first coupon is to be paid in exactly
How do tax breaks constitute a missed opportunity : How do tax breaks constitute a missed opportunity?
Compute what is the warranty expense : Cost for each computer will be $10 for each computer. In 20X9, the company actually incurs warranty cost of $1,000. What is the warranty expense for 20x9?
Affect network security : Discuss how the advent of AI/MI and how it may affect network security.
Compare value vs price to make a decision : You own two annuity investments and have a discount rate of 12% p.a.
Illustrate the interest expense of the bonds on december : Illustrate the interest expense of the Bonds on December 31, 20x8.On March 31, 20x7, Pepe issued for $887,000, $1,000,000 face amount of its 10%, $500,000 bonds
What is nomad cash conversion cycle : Nomad Products has an inventory turnover of seven times per year, a receivables turnover of ten times, and a payables turnover of fifteen times.
Determine what amount reported as liability from lawsuit : The legal counsel believed the entity would probably lose the lawsuit. Compute what amount should be reported as liability from lawsuit?
Computer incident response team plan : Did the student consider the inputs provided in their earlier submissions? Did the student develop a sound CIRT plan?

Reviews

Write a Review

Business Management Questions & Answers

  What can you predict might be the future trends

Is each a growth sport/activity/hobby in Australia or worldwide and What are the participation trends for each sport/activity/hobby over time

  Calculate the expected npv of project

The probabilities of these three conditions are 30%, 50% and 20%, respectively. Calculate the expected NPV of this project

  Setting the stagecoach thundering again case study

Do you have any details on the 2017 Wells Fargo: Setting the Stagecoach Thundering Again case study?

  Business benefits for object orientated programming

What is the difference between polymorphism, inheritance and encapsulation? What are the business benefits for object orientated programming?

  Effects of the use of information technology

The readings this week raise issues that are direct or indirect effects of the use of information technology:

  Hazard identification procedures take into consideration

Hazard identification procedures take into consideration that a range of changing factors may result in new or heightened hazards within the workplace

  Consumer expenditure maximized

Suppose that the demand function is given by Qd=24-b x P Suppose that b=2. At which price is consumer expenditure maximized?

  Describe the organizations current compensation philosophy

Describe the organization's current compensation philosophy. Identify the key factors that should contribute to the organization's development.

  Two bonds expected to exhibit negative convexity

Suppose that the current market yield for 10-year corporate bonds is 7%.-  Which of these two bonds would be expected to exhibit negative convexity?

  National association of latino arts and culture

National Association of Latino Arts and Culture

  Does anyone think cox is a transformational leader

Does anyone think Cox is a transformational leader? Why or why not?

  What is the pareto efficient level of g

Cindy and Dan share a public good G. Cindy's preferences are Uc = Xc + 2G^1/2, and she has income Mc. Dan has preferences Ud = Xd + 8G^1/2, and he has income Md. Both X and G have a price of 1.

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!

Submit Assignment

Academics

Major Subjects

Majors

Get In Touch

whatsapp: +1-415-670-9521

Phone: +1-415-670-9521

Email: [email protected]

TERMS & POLICIES

HELP & SUPPORT

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd