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How much money can he borrow from the bank

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Q1. Sean expects to receive $300,000 in 5 years from a trust fund. If a bank loans money at an interest rate of 8.2%, how much money can he borrow from the bank on the basis of this information?

a. $199,513.63

b. $204,174.96

c. $202,294.91

d. $222,460.51

Q2. The major factors that determine the value of a firm's stocks is/are ____

a. The amount of the cash flows expected to be generated for the benefit of stockholders

b. All of the above

c. The timing of these cash flows

d. The risk of the cash flows

Q3. Matthew wants to take out a loan to buy a car. He calculates that he can make repayments of $25,000 per year. If he can get a seven-year loan with an interest rate of 8.50%, what is the maximum price he can pay for the car?

a. $119,918

b. $116,598

c. $127,963

d. $126,557

Reference no: EM133146484

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