Would the investment be acceptable to you

Assignment Help Finance Basics
Reference no: EM132019999

Question: You have been offered the opportunity to buy into a real estate investment. The investment is expected to pay out about $16,450 after-tax dollars a year. The investment requires an $96,000 investment from you. You would normally invest for 10 years and similar investments must earn 12%. Would this investment be acceptable to you? Please show all work.

Reference no: EM132019999

Questions Cloud

What is the most you would invest today : You are offered an investment that will pay you $800, $1200, $1500, $1700, $2000, $2500, $3000, and $3500 over the next eight years (one cash payment per year).
What is the firm degree of operating leverage : What is the firm's degree of operating leverage (defined as the ratio of the percent change in EBIT to the percent change in sales) in going from a recession.
Calculate the dirty price of the transaction : On October 5, 2015, you purchase a $11,000 T-note that matures on August 15, 2027 (settlement occurs two days after purchase, so you receive actual ownership.
How much do you have to pay : You obtain the following quotes from a dealer for a 10-year Treasury bond: If you want to buy this T-bill, how much do you have to pay?
Would the investment be acceptable to you : You have been offered the opportunity to buy into a real estate investment. The investment is expected to pay out about $16,450 after-tax dollars a year.
Find remaining balance after initial interest rate period : You have obtained a 30-year adjustable rate mortgage at 3.74% with a principal of $864,125. The adjustment period is 4/2 with a cap structure of 2/8.
How many quotes the authors recommend : When obtaining a mortgage, in order to not be taken, paying a much higher rate than neccessary, which can easily cost well over 100,000 additional dollars.
Evaluate each company price to book value : Evaluate each company's Price to Book Value multiple in the context of their own ROE. Evaluate the Price to Book Value multiples of each company relative.
What rate of interest will you receive : You are offered the opportunity to buy a note for $12, 800. The note is certain to pay $2,000 at the end of each of the next 10 years.

Reviews

Write a Review

Finance Basics Questions & Answers

  Determine the annual net pretax benefits to jackson

Funds released by the lockbox arrangement can be invested elsewhere in the firm to earn 14 percent before taxes. The Chicago bank has agreed to process Jackson's customer payments for an annual fee of $130,000. Determine the annual net pretax benefit..

  Ratio analysis for both wal-mart and sears

Conduct a ratio analysis for both Wal-Mart and for Sears (Sears Holdings) for the last three years. Amongst other ratios, be sure to include the DuPont Analysis

  Calculate gross margin and total contribution margin

The following data has been provided by the Evans Retail Stores, Corporation, for the first quarter of the year:

  Fred and mary are contemplating a family gifting program of

1. under the current arrangements which of the following is fred able to change without probate court involvement if

  Based on absolute advantage and comparative advantage

as was seen during the financial crisis of the 1930s and in recent history markets are interconnected globally. aside

  What are transactions costs

What are transactions costs? - Does financial intermediation increase or decrease transactions costs?

  Determine the single greatest challenge to a small business

Determine the single greatest challenge to a small business' working capital. Identify at least two methods this small business could use to address the identified challenge.

  What is the value of a building

What is the value of a building that is expected to generate fixed annual cash flows of 101,750 dollars every year for a certain amount of time.

  What markup percentage is the company using

Sanai manufacturing company produces and sells 40,000 units of a single product. Variable costs total $80,000 and fixed costs total $120,000. If each unit is sold for $8, what markup percentage is the company using?

  How much can nelsons short-term debt notes payable increase

The Nelson Company has $1,155,000 in current assets and $525,000 in current liabilities. Its initial inventory level is $367,500, and it will raise funds as additional notes payable and use them to increase inventory. How much can Nelson's short-term..

  Prepare a cash flow projection for a construction company

Prepare a cash flow projection for a construction company that currently has two projects under contract for the next year and anticipates picking up a third and fourth project during the year. For the first project, the project's owner is holding $2..

  If ebit is 5 million which plan will result in the higher

dinkum dampers ltd ddl is comparing two different capital structures an all-equity plan plan i and a levered plan plan

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!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd