Reference no: EM132814369

Questions -

Q1. Carrie Tune will receive $19,500 for the next 20 years as a payment for a new song she has written. If a 10 percent rate is applied, should she be willing to sell out her future rights now for $160,000?

Q2. Al Rosen invests $25,000 in a mint condition 1952 Mickey Mantle Topps baseball card. He expects the card to increase in value 12 percent per year for the next 10 years. How much will his card be worth after 10 years?

Q3. If you invest $8,500 per period for the following number of periods, how much would you have?

a. 12 years at 10 percent.

b. 50 years at 9 percent.

Q4. Your father offers you a choice of $105,000 in 12 years or $47,000 today.

a. If money is discounted at 8 percent, which should you choose?

b. If money is still discounted at 8 percent, but your choice is between $105,000 in 9 years or $47,000 today, which should you choose?

Q5. If you borrow $9,441 and are required to pay back the loan in five equal annual installments of $2,750, what is the interest rate associated with the loan?