The Diagonal Stamp Company, which sells used postage stamps to collectors, advertises that its average price has
Question:
The Diagonal Stamp Company, which sells used postage stamps to collectors, advertises that its average price has increased from $1 to $5 in the last 5 years. Thus, management states, investors who had purchased stamps from. Diagonal 5 years ago would have received a 100% rate of return each year.
(a) To check their calculations, compute the annual rate of return.
(b) Why is your computed rate of return less than 100%?
Fantastic news! We've Found the answer you've been seeking!
Step by Step Answer:
Answer rating: 76% (13 reviews)
a F 5 P 1 n 5 F P 1 i n 5 1 1 i 5 1 i 5 020 138 i ...View the full answer
Answered By
Joseph Mwaura
I have been teaching college students in various subjects for 9 years now. Besides, I have been tutoring online with several tutoring companies from 2010 to date. The 9 years of experience as a tutor has enabled me to develop multiple tutoring skills and see thousands of students excel in their education and in life after school which gives me much pleasure. I have assisted students in essay writing and in doing academic research and this has helped me be well versed with the various writing styles such as APA, MLA, Chicago/ Turabian, Harvard. I am always ready to handle work at any hour and in any way as students specify. In my tutoring journey, excellence has always been my guiding standard.
4.00+
1+ Reviews
10+ Question Solved
Related Book For
Question Posted:
Students also viewed these Economics questions
-
Suppose the University of Memphis advertises that its average class size is 35 students or less. A student organization is concerned that budget cuts have led to increased class sizes and would like...
-
A courier service advertises that its average delivery time is less than 6 hours for local deliveries. A random sample of times for 12 deliveries to an address across town was recorded. These data...
-
A professor buys postage stamps and puts them in an envelope. Exactly 30 of the stamps are for letters, and exactly 10 of the stamps are for postcards. The professor's wife grabs two stamps. All...
-
When completed submit your assignment to the appropriate area. Company A, an American company, owns Company B, a Canadian subsidiary. Company A borrowed 1,000,000 Canadian dollars as a hedge on its...
-
Use synthetic division to verify the upper and lower bounds of the real zeros of f. 1. f (x) = x3 + 3x2 2x + 1 a) Upper: x = 1 b) Lower: x = - 4 2. f (x) = x3 4x2 + 1 a) Upper: x = 4 b) Lower: x =...
-
Derive an expression for the temperature distribution in a plane wall in which there are uniformly distributed heat sources which vary according to the linear relationqG = qw [1 ?? (T ?? Tw)]where qw...
-
Indicate whether each of the cost control methods listed in a through \(f\) is (1) preventive, (2) corrective, or (3) diagnostic. a. Preparation of an annual production budget of variable and fixed...
-
Reds Lumber hired a consultant to update its system for reporting the cost of customers. The consultant showed Red an analysis that indicates that customer support costs are significantly higher for...
-
d P2 The vertical U-Section of a water distribution system seen on the drawing is considered. All hydraulic and dimensional data of the flow piece are known as given below. Calculate the Horizontal...
-
A 3-year project is under consideration. Here's what's known about its cash flows: $3,000,000 would need to be spent immediately to buy production equipment The production equipment will be...
-
An investor purchased 100 shares of Omega common stock for $9000. He held the stock for 9 years. For the first 4 years he received annual end-of-year dividends of $800. For the next 4 years he...
-
You spend $1000 and in return receive two payments of $1094.60-- one at the end of 3 years and the other at the end of 6 years. Calculate the resulting rate of return.
-
Paul, age 37, participates in a Section 401(k) plan which allows employees to contribute up to 15 percent of their salary. His annual salary is $125,000 in 2018. What is the maximum he can...
-
MSI's educational products currently are sold without any supplemental materials. The company is considering the inclusion of instructional materials such as an overhead slide presentation, potential...
-
Read the job descriptions. Are they accurate descriptions for jobs that you would be applying for? Why or why not? Are there jobs for which you cannot find an appropriate match? Why do you think this...
-
Calculate the future value of the following annuities, assuming each annuity payment is made at the end of each compounding period. (FV of $1, PV of $1, FVA of $1, and PVA of $1) (Use tables, Excel,...
-
1 Find a Laurent Series for f(z) = which is valid in the domain (z-4i) {z: 4
-
A 4.20 kg block is attached to a spring with spring constant 2140 N/m. The block is resting on a horizontal, frictionless surface. It is pulled 4.20 cm from the equilibrium position and given an...
-
When is a correcting entry necessary?
-
Write the general quadratic equation y2 - 8y - 4x + 28 = 0 in standard form. Determine the vertex, focus, and directrix of the parabola defined by this equation. Sketch a graph.
-
The demand curve and supply curve are estimated to be the same as in problem 4. Following a dramatic increase in the value of the stock market, many retirees started moving money out of the stock...
-
Consider the following data on an asset: Cost of the asset, !............................... $73,000 Useful life, N.............................. 7 years Salvage value ,...
-
On January 2, 2004, the Allen Flour Company purchased a new machine at a cost of $82,000. Installation costs for the machine were $3,000. The machine was expected to have a useful life of 10 years,...
-
On March 17, 2007, the Wildcat Oil Company began operations at its Louisiana oil field. The oil field had been acquired several years earlier at a cost of $32.5 million. The field is estimated to...
-
UB is examining its capital structure with the intent of arriving at an optimal debt ratio. It currently has no debt and has a beta of 1 . 5 . The riskless interest rate is 9 % . Your research...
-
What is the primary objective of investing? What aspect to an investment other than potential gains must be considered?
-
John and Julie Johnson are interested in saving for their retirement. John and Julie have the same birthday - - both are 5 0 years old today. They started saving for their retirement on their 2 5 th...
Study smarter with the SolutionInn App