Finance quiz 36 question | Business & Finance homework help

Question 1

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1 points

Question 2

.      027:Say, you deposit \$1,138 in a bank for 18 years. What is the amount you will have in the bank at the end of 18 years if interest of 6 % compounded monthly for first 5 years and interest of 10 % compounded quarterly for the remaining years? Note: Do not put \$ sign in your answer. Simply write the number in the answer box.  Answer

1 points

Question 3

.      How many months it will take to grow your money from \$4,760 to \$7,928 if you can earn an interest of 11% compounded monthly? Note: Do not write “months” in your answer. Simply write the number in the answer box.  Answer

1 points

Question 4

.      If you put \$700 in a savings account with a 10% nominal rate of interest compounded monthly, what will the investment be worth in 21 months (round to the nearest dollar)?  Answer

 . .    a. .    \$770 . .    b. .    \$1,176 . .    c. .    \$827 . .    d. .    \$828 . .    e. .    \$833

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1 points

Question 5

.      How much do you need to invest today in order to have \$4,555 at the end of 9 years if you are sure to earn an interest at the rate of 13%, if interest is compounded quarterly? Note: Do not put \$ sign in your answer. Simply write the number in the answer box.  Answer

1 points

Question 6

.      How much do you need to invest today in order to have \$6,756 at the end of 6 years if you are sure to earn an interest at the rate of 10%, if interest is compounded monthly? Note: Do not put \$ sign in your answer. Simply write the number in the answer box.  Answer

1 points

Question 7

.      How many years it will take to grow your money from \$4,168 to \$8,282 if you can earn an interest of 6% compounded quarterly? Note: Do not write “years” in your answer. Simply write the number in the answer box.  Answer

1 points

Question 8

.      Assume interest rate of 12%. A company receives cash flows of \$596 at the end of year 5, \$238 at the end of year 7, and \$542 at the end of year 10. Compute the future value of this cash flow stream.Do not enter the symbol \$ in your answer. Simply enter the answer rounded off to two decimal points.    Answer

1 points

Question 9

.      Consider a 10-year loan with monthly payments at 10%. If the loan amount is \$250,000, compute the Interest paid during the 6th year.Enter your answer rounded off to two decimal points. Do not enter \$ in the answer box. Answer

1 points

Question 10

.      The ABC Company is considering a new project which will require an initial cash investment of \$10,754. The projected cash flows for years 1 through 4 are \$9,870, \$5,696, \$9,263, and \$5,029, respectively. If the appropriate discount rate is 3%, compute the NPV of the project.Enter your answer rounded off to two decimal points. Do not enter \$ in the answer box.   Answer

1 points

Question 11

.      What is the future value of \$186 for 14 years at 6 percent if interest is compounded semi-annually? Note: Do not enter “\$” in your answer. Simply write down the number that you get as your answer.  Answer

1 points

Question 12

1 points

Question 13

.      Barrett Pharmaceuticals is considering a drug project that costs \$180,372 today and is expected to generate end-of-year annual cash flows of \$11,811, forever. At what discount rate would Barrett be indifferent between accepting and rejecting the project? Just enter the number in percentages up to 2 decimal points. Do not enter % in the answer box. Answer

1 points

Question 14

.      Assume interest rate of 7%. Suppose that you receive \$73,343 at the end of each year for 4 years. Suppose that this cash flow starts at the end of the fourth year. Compute the present value.Do not enter the symbol \$ in your answer. Simply enter the answer rounded off to two decimal points.  Answer

1 points

Question 15

.      Assume interest rate of 4%. A company receives cash flows of \$81,403 at the end of years 4, 5, 6, 7, and 8, and cash flows of \$289,772 at the end of year 10. Compute the future value of this cash flow stream.Do not enter the symbol \$ in your answer. Simply enter the answer rounded off to two decimal points. Answer

1 points

Question 16

.      In order to buy a house, you take a loan of 100,000 at 7.5% for a period of 13 years. Compute the balance remaining at the end of 5 years.Do not enter the symbol \$ in your answer. Enter your answer as a positive number. Simply enter the answer rounded off to two decimal points. Answer

1 points

Question 17

.      How much do you need to invest today in order to have \$6,469 at the end of 11 years if you are sure to earn an interest at the rate of 8%? Note: Do not put \$ sign in your answer. Simply write the number in the answer box.  Answer

1 points

Question 18

.      How many years it will take you to quadruple (means 4 times) your money if you can earn 11.63% each year? Note: Do not write “years” in your answer. Simply write the number in the answer box.  Answer

1 points

Question 19

.      If the effective rate is 17%. What is the nominal rate if compounding is daily.  Do not enter the symbol % in your answer. Simply enter the answer in percentages rounded off to two decimal points.  Answer

1 points

Question 20

.      What is the future value of annual payments of \$2,281 for 9 years at 4 percent? Answer

1 points

Question 21

.      If you receive \$389 at the end of each year for the first three years and \$595 at the end of each year for the next three years. What is the present value? Assume interest rate is 5%. Hint: This is an uneven cash flow problem. Use the CF function and solve for NPV to get the answer. Just enter the number up to 2 decimal points. Do not enter \$ in the answer box.  Answer

1 points

Question 22

.      What is the future value of \$4,935 invested for 7 years at 16% if interest is compounded quarterly? Note: Do not put \$ sign in your answer. Simply write the number in the answer box.  Answer

1 points

Question 23

.      Kelly starting setting aside funds 4 years ago to buy some new equipment for her firm. She has saved \$3,645 each quarter and earned an average rate of return of 8 percent. How much money does she currently have saved for this purpose?  Answer

1 points

Question 24

.      How many years it will take you to double your money if you can earn 14% each year, given that compounding is quarterly? Note: Do not write “years” in your answer. Simply write the number in the answer box.  Answer

1 points

Question 25

.      The ABC Company is considering a new project which will require an initial cash investment of \$5,066. The project will produce no cash flows for the first 5 years. The projected cash flows for years 6 through 9 are \$2,852, \$4,427, \$6,992, and \$4,303, respectively. If the appropriate discount rate is 7%, compute the NPV of the project.Enter your answer rounded off to two decimal points. Do not enter \$ in the answer box.      Answer

1 points

Question 26

.      How many years it will take to grow your money from \$3,573 to \$6,334 if you can earn an interest of 6% compounded monthly? Note: Do not write “years” in your answer. Simply write the number in the answer box.  Answer

1 points

Question 27

.      What is the effective rate of 10% compounded monthly? Do not enter the symbol % in your answer. Simply enter the answer in percentages rounded off to two decimal points. Answer

1 points

Question 28

.      026:Say, you deposit \$1,802 in a bank for 16 years. What is the amount you will have in the bank at the end of 16 years if interest of 3 % for first 6 years and interest of 8 % for the remaining years? Note: Do not put \$ sign in your answer. Simply write the number in the answer box.  Answer

1 points

Question 30

.      What is the future value of \$4,515 invested for 18 years at 19% if interest is compounded semi-annually? Note: Do not put \$ sign in your answer. Simply write the number in the answer box.  Answer

1 points

Question 31

.      What is the future value of quarterly payments of \$779 for 18 years at 4 percent?  Answer

1 points

Question 32

1 points

Question 33

.      The Perpetual Life Insurance Co is trying to sell you an investment policy that will pay you and your heirs \$14,581 per year forever. Suppose the Perpetual Life Insurance Co. told you the policy costs \$156,868. At what interest rate would this be a fair deal? Just enter the number in percentages up to 2 decimal points. Do not enter % in the answer box. Answer

1 points

Question 34

.      Today, you are purchasing a \$1,362 3-year car loan at 14 percent. You will pay annually at the end of each year. What is the amount of each payment?  Answer

1 points

Question 35

.      What should you be willing to pay in order to receive \$606 annually forever, if you require 10% per year on the investment? Just enter the number up to 2 decimal points. Do not enter \$ in the answer box.  Answer

1 points

Question 36

What is the future value of \$2,627 invested for 22 years at 6% if interest is compounded semi-annually (twice a year)? Note: Do not put \$ sign in your answer. Simply write the number in the answer box.

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