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What is the present value of your settlement

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Reference no: EM132016067

1. A limit order to buy:

A. guarantees the quantity purchased but not the price.

B. guarantees both the purchase price and the order fulfillment. C.

D. is executed only if the purchase price is less than the limit amount. guarantees the purchase price but not the order execution. E. will be executed either at the limit price or at the end-of-day price.

2. As a settlement, you are to receive $500,000. This sum will be paid out as $50,000 per year for each of the next ten years. Assuming an interest rate (discount rate) of 7%, what is the present value of your settlement?

3. Assume that you’re purchasing a house for $225,000. You have enough cash on hand to put 20% down and you wish to finance the remaining principal balance. Assuming a fifteen-year mortgage and an interest rate of 5%, what will be your annual house payment?

4. You wish to have $50,000 in five years. If you can earn 6% on your money, how much will you need to set aside at the end of each of the next five years in order to attain your objective?

Reference no: EM132016067

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