Simple interest on investment accounts

Assignment Help Financial Management
Reference no: EM131955005

First Simple Bank pays 8.9 percent simple interest on its investment accounts. If First Complex Bank pays interest on its accounts compounded annually, what rate should the bank set if it wants to match First Simple Bank over an investment horizon of 8 years? (Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.)

Reference no: EM131955005

Questions Cloud

Examine what is the intrinsic value of the stock : Caskey Inc. is experiencing a period of growth. Dividends are expected to grow at a rate of 14.00% for the next two years and 6.00% thereafter.
Determine the number of units tha should be manufactured : If production for either cabinet exceeds demand in month 1, the cabinets can be stored at a cost of $5 per cabinet.
What is the initial cattle-hog spread : Cattle prices are currenlty $0.70/pound and hog prices are $0.60/pound. Expecing the price difference between cattle and hogs to continue to grow wider.
What is your rate of return on investment : If the company paid $0.37 per share in dividends over this period, what is your rate of return on the investment?
Simple interest on investment accounts : First Simple Bank pays 8.9 percent simple interest on its investment accounts.
How will the given problem be resolved : Supposed CBI loses $150 billion in CDO investments. What is this problem called? Show this with a balance sheet. How will this problem be resolved?
Explain and analysis how chapters are related : Guided Book Critique of Carter G. Woodson's The Miseducation of the Negro. Critique the selected chapters and explain and analysis how they are related.
What is the meaning of life : Describe how you chose your subject, give a description of your subject, and record their answers to these questions.
Compute effective annual rate of interest : Compute the effective annual rate of interest. Explain how Treasury notes and bonds are quoted and how to translate those quotes into the market price.

Reviews

Write a Review

Financial Management Questions & Answers

  What happens to bond prices and their yields in response

Explain what happens to bond prices and their yields in response to: A decrease in business confidence. An increase in business confidence.

  Preferred stock and constant growth valuation

What is the required rate of return? What is the stock's current value per share?

  Market value ratios

Ratios are mostly calculated based on the financial statements of a firm. Taggart Goods Corp. just reported a net income of $5,000,000, and its current stock price is $23.00 per share. Taggart is forecasting an increase of 25% for its net income next..

  Themselves from becoming victim to fraudulent activity

Reflect on and summarize why trust is a factor in order for fraud to be committed. How has this been proven based on what you have learned related to Ponzi Schemes? How can organizations and individuals protect themselves from becoming victim to frau..

  Calculate the present value of each given option

If the interest rate is 6% annually, calculate the present value of each option. -  At what interest rate do Option II and Option III have the same present value?

  The efficient markets hypothesis implies

The efficient markets hypothesis implies that the expected future return on any portfolio of assets must be zero,

  Contribute to an increase in company valuation

What are the main reasons risk management might contribute to an increase in a company’s valuation?

  What annual interest rate-future with quarterly compouding

What annual interest rate do you need for an investment to be worth $10,207.73 seven years in the future with quarterly compouding if you deposit $6,500 today?

  The price of great american landscaping

The price of Great American Landscaping Inc. is now $85. The company pays no dividends. Toby Chysler expects the price four years from now to be $125 a share. Should Toby buy Great American Landscaping if he wants a 15 percent rate of return? Explain..

  The initial costs of the project

what value should be assigned to this machine and included in the initial costs of the project?

  What is the payback period of this? investment

It is expected to make $4.3 million in the year it is released and $1.8 million for the following four years. What is the payback period of this? investment?

  What is the future value at the end of the third year

What is the future value at the end of the third year?

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