The following historical time between failure and repair time for a certain punch press is available. The machine was installed in the month of June after an appropriate burn-in period. The first breakdown happened on August 5, after 221 hours of use. (see chart in attached file) Date 8/5 11/6 12/19 2/7 3/30 # of hrs of
What is the present value today of your projected monthly retirement check of $2,000 (your estimate which you will receive when you reach 65)? You turn 65 in 25 years and you think inflation will be 6 percent a year between now and your retirement.
(Computation of Future Values and Present Values) Using the appropriate interest table, answer each of the following questions. (Each case is independent of the others.) (a) What is the future value of $7,000 at the end of 5 periods at 8% compounded interest? (b) What is the present value of $7,000 due 8 periods hence, disco
In 1880 five aboriginal trackers were each promised the equivalent of 100 Australian dollars for helping to capture the notorious outlaw Ned Kelley. In 1993 the granddaughters of two of the trackers claimed that this reward had not been paid. The Victorian prime minister stated that if this was true, the government would be happ
You deposit $1,000 in your bank account. If the bank pays 4 percent simple interest, how much will you accumulate in your account after 10 years? What if the bank pays compound interest? How much of your earnings will be interest on interest?
I want to buy a car. I can get a loan for $6,000.00 at a 12% interest rate. I can afford $230.00 a month for payments. How long will it take me to pay off the loan.
Jane is a finance major at a university and has a $600 overdue debt for books and supplies at the bookstore. She has only $200 in her checking account and doesn't want her father to know about this debt. The manager at the bookstore tells her that she may settle the account in one of two ways since she cannot pay it all now.
23. Annuities and Interest Rates. Professor's Annuity Corp. offers a lifetime annuity to retiring professors. For a payment of $80,000 at age 65, the firm will pay the retiring professor $600 a month until death. a. If the professor's remaining life expectancy is 20 years, what is the monthly rate on this annuity? What is
1. How much would you have to invest today to receive $12000 in three years for Great Barrier Reef P=present value, F= Future value r= rate of interest n=duration P=F/(1+r)^n a. at 4 % b. at 10 percent? b. at 18 percent? 2. Case of Partial retirement
The Acme Company must solve a series of five problems that require you to apply the concept of "time value of money," or TVM. The five problems are listed below. Solving them will require the use of Microsoft Excel. Before you begin your work, each student is to select a unique nine-digit random number that contains no zeros, no
Explain how annuities affect TVM problems and investment outcomes with the impact of the following items listed below - this does not have to be exstensively long a. Interest Rates and Compounding b. Present Value (of a future payment received) c. Future Value (of an investment) d. Opportunity cost e.
What is the difference between "simple" and "compound" interest? What are some of the uses of compound interest in business? How is a home mortgage an example of TVM?
1)You would like to take a cruise in six years. The cruise currently costs $4,250. You expect the price to increase by 4% annually. You can earn 5% on your savings. How much do you need to save at the end of each month so you will be able to afford your cruise in six years? 2)You invest $250 in your savings account at the end
1. A corporate bond currently yields 8.5 percent. Municipal bonds with the same risk, maturity, and liquidity currently yield 5.5 percent. At what tax rate would investors be indifferent between the two bonds? a. 35.29% b. 40.00% c. 24.67% d. 64.71% e. 30.04% 2. A money manager is holding the following portfolio:
What could Starbucks do to make its stores even more elegant that welcomed, rewared and suprised customers? What new products and experiece can Starbucks provide and how can they reach people who are not coffee drinkers? What strategic paths can Starbucks pursue its objectives as becoming the most respected and recognized br
Please help with the questions below, most are multiple choice, but some just need an answer....thank you. #1 If the variable cost per unit increases while the sales price per unit and total fixed costs remain constant, the _______________. a. break-even point increases b. break- even point decreases c. break- even poin
Below is an attatched excel file to help solve this problem. Just look over at the stock prices to figure it out. What is Standard Hopkinson's earnings per share?
The following table shows the past two years of quarterly sales information. Assume that there are both trend and seasonal factors and that the seasonal cycle is one year. Use time series decomposition to forecast quarterly sales for the next year. Quarter Sales 1
You make deposits of $2 each year for 30 years. The rate of interest that will prevail is 10 percent for the first 20 years and then 12 percent for the remaining period. If the interest rate is compounded continuously, what is the present and future value of these deposits.
Compute the future value of $1000 continuously compounded for: a) five years, at stated annual rate of 12% b) three years at stated annual rate of 10% c) 10 years at at stated annual rate of 5% d) eight years at a at stated annual rate of 7%
What is the future value three years hence of $1000 invested in an account with a stated annual interst rate of 8%: a) compounded annually? b) compounded semiannually? c) compounded monthly? d) compouuned continuously? e) Why does the future value increase as the compounding period shortens?
(Helpful hint: Excel Spreadsheet or financial calculator will make calculations easier.) Chapter 7(Brealey et al) Practice Problems 1. NPV rule states that you should accept projects with a positive net present value. a. True b. False 2. If you're comparing two mutually exclusive projects which both have positive NPV,
Spirit Software Inc. is a computer software company that generated $ 12 million in pre-tax operating income on $ 100 million in revenues last year; the firm is stable and does not expect revenues or operating income to change over the next 10 years. Its inventory management is in shambles and inventory as a percent of revenues a
The future value of an annuity is A=$32,000. Periodic payments are made quarterly for four years and the annuity earns 8% compounded quarterly. Find the periodic payments. A. $422.40 B. $1,716.80 C. $2000.00 D. $2,160.00
You just put $1,000 in a bank account which pays 6 percent nominal annual interest, compounded monthly. How much will you have in your account after 3 years?
How much would you have to invest today to receive: a. $15,000 in 8 years at 10 percent? b. $20,000 in 12 years at 13 percent? c. $6,000 each year for 10 years at 9 percent? d. $50,000 each year for 50 years at 7 percent?
"The study level of Other is Masters." What practical value can be gained from the following: present value, future value, opportunity cost?
5. (Computation of Future Values and Present Values) Using the appropriate interest table, answer each of the following questions. (Each case is independent of the others.) a. What is the future value of $7,000 at the end of 5 periods at 8% compounded interest? b. What is the present value of $7,000 due 8 periods hence, disc
Why does money have a time value? Does inflation have anything to do with making a dollar today worth more than a dollar tomorrow? If, as an investor, you had a choice of daily, monthly, or quarterly compounding, which would you choose? Why?
1. Dr. I. N. Stein has just invested $6,250 for his son (age one). The money will be used for his son's education 17 years from now. He calculates that he will need $50,000 for his son's education by the time the boy goes to school. What rate of return will Dr. Stein need to achieve this goal? 2. Betty Bronson has just retir