User Account

All Pages

They are a good investment. what is their present value

Assignment Help Finance Basics
Reference no: EM131100575

Assume that you inherited some money. A friend of yours is working as an unpaid intern at a local brokerage firm, and her boss is selling some securities that call for four payments, $50 at the end of each of the next 3 years, plus a payment of $1,050 at the end of Year 4. Your friend says she can get you some of these securities at a cost of $900 each. Your money is now invested in a bank that pays an 8 percent nominal (quoted) interest rate but with quarterly compounding. You regard the securities as being just as safe, and as liquid, as your bank deposit, so your required effective annual rate of return on the securities is the same as that on your bank deposit. You must calculate the value of the securities to decide whether they are a good investment. What is their present value to you?

Reference no: EM131100575

Questions Cloud

What is the total amount of interest that was paid : Assume that your aunt sold her house on December 31 and that she took a mortgage in the amount of $10,000 as part of the payment. The mortgage has a quoted (or nominal) interest rate of 10 percent, but it calls for payments every 6 months, beginning ..
Derive an expression for the phase-conjugate reflectivity : [Hint: This problem can be solved using the formalism developed in Section 6.3. This problem has been solved in the scientific literature, and the solution is given by Abrams and Lind, 1978.]
Contrast the biases of availability heuristics : Compare and contrast the biases of availability heuristics, representative heuristics, and escalation of commitment in the decision-making process.
Explain to her about the rh factor : She has heard that there may be a problem with the baby. Explain to her about the Rh factor and how this situation is taken care today.
They are a good investment. what is their present value : Assume that you inherited some money. A friend of yours is working as an unpaid intern at a local brokerage firm, and her boss is selling some securities that call for four payments, $50 at the end of each of the next 3 years, plus a payment of $1,05..
Define what is meant by motivation-ability and opportunity : Define what is meant by motivation, ability and opportunity.  In addition to defining each concept, make sure that you convey what the differences are between each of these concepts. Provide a solid example that illustrates each concept in the seq..
What is the purpose of the test : What is the purpose of the test (personality, screening, Marriage counseling, placement for children, etc.)? Who developed it and why? How is it used?
Design a combinational verilog module : The starter code from the course web page includes test benches for each problem below. For each of the following, please submit the source code for your Verilog module along with a printout or screen capture of waveform plots indicating a success..
The general linear programming formulation : Consider the general linear programming formulation of the transportation problem (see Table 8.6). Verify the claim in Sec. 8.2 that the set of (m + n) functional constraint equations (m supply constraints and n demand constraints) has one redunda..

Reviews

Write a Review

Finance Basics Questions & Answers

  Financial reporting and analysis

Finance is about Gunns Ltd, a company in dealing with forestry products in Australia. The company has also been listed in Australian Stock Exchange. As many companies producing forestry products, even Gunns Ltd is facing various problems. Due to the ..

  A report on financial accounting

This report is specific for a core understanding for Financial Accounting and its relevant factors.

  Describe the types of financial ratios

Describe the types of financial ratios and other financial performance measures that are used during venture's successful life cycle.

  Differences between sole proprietorship and corporation

Briefly describe the major differences between a sole proprietorship and a corporation

  Prepare a cash budget statement

Calculate the expected value of the apartment in 20 years' time. What is the mortgage loan repayment at the beginning of each month

  What are the implied interest rates

What are the implied interest rates in Europe and the U.S.?

  State pricing theory and no-arbitrage pricing theory

State pricing theory and no-arbitrage pricing theory

  Small business administration

Identify the likely stage for each venture and describe the type of financing each venture is likely to be seeking and identify potential sources for that financing.

  Effect of financial leverage

The Effect of Financial Leverage and working capital management

  Evaluate the basis for the payment to the lender

Evaluate the basis for the payment to the lender and basis for the payment to the company-counterparty.

  Importance of opps, ipps, mpfs and dmepos

Research and discuss the differences and importance of : OPPS, IPPS, MPFS and DMEPOS.

  Time value of money

Time Value of Money project

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