Find what is the npv of home investment

Assignment Help Financial Accounting
Reference no: EM132930262

Assume you are buying a home between $100,000 and $400,000 in Texas. Assume a price that has not been chosen by another student; for example if a student has chosen a $300,000 home price then no other student should choose a $300,000 home. Assume you borrow 80 % of the purchase price at 3.75 % interest rate. Assume interest and principal are paid annually, at the end of each year for 15 years. This will be a 15-year loan.

Problem 1: What is your annual payment?

Problem 2: What is the loan balance after 4 years?

Problem 3: How much total payment you have made after 4 years?

Problem 4: Suppose at the end of year 2 you spend $5,000 and at the end of year 3 you spend another $6,000 for the upkeep of your home. Suppose at the end of year 4 you sell your home at 30 % above the purchase price. What is the NPV of your home investment? Use a 3.75% discount rate. The NPV of your investment?

Reference no: EM132930262

Questions Cloud

What division a residual income would be : If the minimum rate of return was 8%, Division A's residual income (RI) would be? Selected data from Division A of Green Company
Career in healthcare management : Explain how it will help you in your education and your career in healthcare management.
Determine rochelle beauport self concept : Applying your knowledge in self-concept characteristics how would you determine Rochelle Beauport's self concept?
What is its weighted average cost of capital : If Alexandria Gazette is expected to have a dividend yield of 6 percent and a growth rate of 4 percent. What is its weighted average cost of capital
Find what is the npv of home investment : Suppose at the end of year 4 you sell your home at 30 % above the purchase price. What is the NPV of your home investment?
What is importance of teamwork : What is the importance of teamwork? Discuss the advantages and disadvantages in working in teams.
Find what farmer john internal rate of return for tractor : Farmer John's expects this tractor to contribute $5,000 in net returns in the first year. What is Farmer John's internal rate of return for this new tractor?
Discuss the potential legal theories of liability : Discuss the potential legal theories of liability that the physician group and hospital each might encounter in this matter. To whom, if anyone, would the group
What variables be cost drivers of weekly customer-service : What variables, in addition to number of service reports, might be cost drivers of weekly customer-service costs of Clancey Products

Reviews

Write a Review

Financial Accounting Questions & Answers

  Financial statement analysis and preparation

Financial Statement Analysis and Preparation

  Shareholder of a company

Describe the ways that a person can become a shareholder of a company. Why Wal-Mart would split its stock?

  Financial and accounting principles

An understanding of financial and accounting principles can be a valuable tool for managers. While not all managers will find themselves calculating financial ratios or preparing annual financial data.

  Prepare a statement of cash flow using the direct method

Prepare a Statement of Cash Flow using the Direct Method and Prepare the Operations section of the Statement of Cash Flow using the Indirect Method.

  Financial accounting assignment

This assignment has one case study and two question apart from case study. Questions related to document Liquidation question and Company financial statements question - Torquay Limited

  Prepare general journal entries for goela

Prepare general journal entries for Goela Ltd

  Principles of financial accounting

Prepare the journal entry to record the acquisition of the assets.

  Prepare general journal entries to record the transactions

Prepare general journal entries to record the transactions, assuming use of the periodic inventory system

  Global reporting initiative

Compare the view espoused by the economist Milton Friedman about the social responsibilities of business with the views express by Stigler.

  Explain the iasb conceptual frameworks

Explain the IASB Conceptual Framework's perspective of users and their decisions.

  Determine the company''s financial statements

T he focus of the report is to determine the extent to which you are comfortable relying on the financial statements as presented by management .

  Computation of free cash flow

Computation of Free Cash Flow

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