Reference no: EM132533232

Question a) Explain why the Future Value of annuity due is always greater than the Future Value of an ordinary annuity with the same rate of return and the same amount of periods.

Question b) Explain why the primary goal of the financial manager should be owner wealth maximization rather that profit maximization for corporation.

Question c) Explain the role that security exchange play in the market place.

Question d) Marcia is planning to buy a car in five (5) years' time. She estimates that the car would cost $2,500,000.00. Given that the existing interest rate is 12 %, how much money should she invest now?

Question e) Marcia has an option to invest in an insurance policy at a rate of 20 %. How much should she invest at the beginning of each year for the next 5 years in order to achieve her goal?

Question f) If the interest rate decreases from 20 % to 15 %, by how much would Marcia annual investment in part e (above) change?