User Account

All Pages

What rate will you have to earn

Assignment Help Accounting Basics
Reference no: EM132997962

Question - You currently have $27,000 that you are looking to invest for two years and are considering a government security maturing in one year that pays 2.25% annually. If you do this, you will also have to purchase 1 year security at the end of the first year. The alternative is to invest in a government security that matures in 2 years. Currently a 2 year government security is paying 3% annually. If you invest your money for 1 year and then after 1 year reinvest it for another year, what rate will you have to earn in order to make the two alternatives equal?

Reference no: EM132997962

Questions Cloud

Development of an effective strategic HRM role : What do you think of the impact of Unilever's transition to outsourcing and offshoring HRM on the HR professionals within Unilever
Should the investment be undertaken and why : Should the investment be undertaken? The estimated present value of all future cash inflows a cash outflow generated from this project (excluding consulting)
What the included in the entry to record the purchase : What the included in the entry to record the purchase of 1,100 shares of treasury stock for $21 per? share
Calculate the mirr for the project for company : The company has a 10% cost of capital, calculate the MIRR for the project. A firm is considering an investment project with the cash flows.
What rate will you have to earn : If you invest your money for 1 year and then after 1 year reinvest it for another year, what rate will you have to earn in order to make two alternatives equal
Calculate the irr for the project for the company : Year 2=$90,000; and Year 3=$30,000, Year 4=$60,000, and Year 5 =$-10,000. The company has a 10% cost of capital, calculate the IRR for the project.
How much will your money grow : Your asset manager deposits $4,500 in a savings account paying 8% per annum interest. How much will your money grow to in 22 years
What is the average age of inventory for Pedro : What is the average age of inventory for Pedro's if it has sales of P320,000, an average inventory of P5,333, and a cash conversion cycle of 20 days
Calculate the npv for the project for company : Year 2=$90,000; and Year 3=$30,000, Year 4=$60,000, and Year 5 =$-10,000. The company has a 10% cost of capital, calculate the NPV for the project.

Reviews

Write a Review

Accounting Basics Questions & Answers

  How much control does fed have over this longer real rate

Hubbard argues that the Fed can control the Fed funds rate, but the interest rate that is important for the economy is a longer-term real rate of interest.   How much control does the Fed have over this longer real rate?

  Coures:- fundamental accounting principles

Coures:- Fundamental Accounting Principles: - Explain the goals and uses of special journals.

  Accounting problems

Accounting problems,  Draw a detailed timeline incorporating the dividends, calculate    the exact Payback Period  b)   the discounted Payback Period. the IRR,  the NPV, the Profitability Index.

  Theory of interest - term structure of interest rates

Term Structure of Interest Rates

  Write a report on internal controls

Write a report on Internal Controls

  Prepare the bank reconciliation for company

Prepare the bank reconciliation for company.

  Cost-benefit analysis

Create a cost-benefit analysis to evaluate the project

  Theory of interest

Theory of Interest: NPV, IRR, Nominal and Real, Amortization, Sinking Fund, TWRR, DWRR

  Liquidity and profitability

Distinguish between liquidity and profitability.

  What is the expected risk premium on the portfolio

Your Corp, Inc. has a corporate tax rate of 35%. Please calculate their after tax cost of debt expressed as a percentage. Your Corp, Inc. has several outstanding bond issues all of which require semiannual interest payments.

  Simple interest and compound interest

Simple Interest, Compound interest, discount rate, force of interest, AV, PV

  Capm and venture capital

CAPM and Venture Capital

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