Already have an account? Get multiple benefits of using own account!
Login in your account..!
Remember me
Don't have an account? Create your account in less than a minutes,
Forgot password? how can I recover my password now!
Enter right registered email to receive password!
1. You just graduated from the University of Arizona. Unfortunately, you have also accumulated a $25,000 student loan over four years. Now you need to start paying it off. Suppose the interest rate on the loan is 6% and you need to pay off the loan in 20 years with equal annual payment every year. a) Figure out what the equal payment amount should be every year. Also figure out a payment schedule of interest and principal payment every year for the 20 years. b) As we know, the interest on student loan, up to $2,500, is deducted from your gross income to figure out your adjusted gross income (AGI). Suppose your marginal tax rate for the first ten years is 15% and 25% for the next ten years. Please figure out how much this deduction has saved you in federal personal income tax every year for the next twenty years. c) Please say in a few sentences why federal government should allow you to deduct student loan interest payment from your income to calculate your tax liability. 2.Suppose Pima County issued a $200 million debt to build a new jail in 2005. The interest rate on the bond was 7%. The original debt payment schedule was to pay off the debt in 30 years with equal annual payment every year. After ten years, the interest rate is now down to 5% in 2015. The County wants to refinance its debt at this low rate, that is to say to issue a new debt at 5% to pay off what is left of the old debt and then pay debt service on the new debt. If the city can issue a new debt at 5% with a maturity of 20 years beginning in 2015, please figure out: a) What is the annual level payment on the old debt? b) What is the amount of the new debt? c) What is the saving in annual payment every year for the next 20 years? (Assume also an equal annual payment on the new debt.) d) Use this case as an example, briefly comment on why citizens should care about your local government debt management. 3. Say Pima County now has an annual budget of $100 million, and by county finance rule, it cannot spend more than 10% of its budget on debt service, including both principal and interest payment. Suppose the county wants to take out a 20-year loan for a capital project. It will be paid back with 20 annual equal payments. a) If the current interest rate is 5% for a 20-year loan, what is the maximum amount the county can borrow for the project? b) Suppose the current interest rate now has dropped to 3%, how much more can the county borrow, so that it can fund other county capital projects? c) Please use this example to explain why the Federal Reserve wants to keep long-term interest rate low in light of our current weak economic condition.
you have secured a loan from your bank for two years to build your home. the terms of the loan are that you will borrow
Suppose that the premium on a European put option, p = $3. The time to maturity, T = 1 year. Make sure that you demonstrate the relation that must be satisfied to eliminate the arbitrage opportunity
what is its gross profit? What is the value of ending inventory? What's the Old inventory units in quantity and cost, as well as the new inventory quantity and cost. What's the sales?
in the context of evaluating sovereign risk which of the following statements is incorrect?a. bankruptcy law does not
What are some economic conditions (including international aspects) that affect the cost of money?
a compilation performed by an auditoris less reliable than audited financial statements. does not require a statement
time value comparisons of single amounts-in exchange for a 20000 payment today a well known company will allow you to
nungesser corporation has issued bonds that have a 9 percent coupon rate payable semiannually. the bonds mature in 8
How large of a sales increase can the company achieve without having to raise funds externally? Round your answer to the nearest cent.
Hexagon declares a four for five reverse split. How many shares are outstanding now? What is the new par value per share?
Suppose if you have $10 today, you can invest that $10 and earn interest. If, for example, you earn 5 percent interest, you will receive $0.50 interest and have a total of $10.50 at the end of year.
financing cycle 2 pages answer the following questions.how can you create and maintain the chart of accounts?how can
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!
whatsapp: +1-415-670-9521
Phone: +1-415-670-9521
Email: [email protected]
All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd