Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

1. Which assertion is true? Person Amount invested Time that funds are invested Annual return on investment Emily 16,450 dollars In 2 year(s) from today

1. Which assertion is true?

Person

Amount invested

Time that funds are invested

Annual return on investment

Emily

16,450 dollars

In 2 year(s) from today

11.42 percent

Theo

34,335 dollars

In 5 year(s) from today

5.78 percent

Zoey

41,613 dollars

In 9 year(s) from today

6.83 percent

Theo will have more money in 13 years than Emily will have in 13 years and Zoey will have more money in 13 years than Emily will have in 13 years

Emily will have more money in 13 years than Theo will have in 13 years and Zoey will have more money in 13 years than Emily will have in 13 years

Emily will have more money in 13 years than Theo will have in 13 years and Emily will have more money in 13 years than Zoey will have in 13 years

Theo will have more money in 13 years than Emily will have in 13 years and Emily will have more money in 13 years than Zoey will have in 13 years

2. What is X if X equals the value of investment A plus the value of investment B? Investment A is expected to pay 13,400 dollars in 7 year(s) from today and has an expected return of 17.94 percent per year. Investment B is expected to pay 19,000 dollars in 2 year(s) from today and has an expected return of 15.73 percent per year.

3. Orange Valley Packaging just bought supplies from Red Royal Consulting. Orange Valley Packaging has been offered the 3 possible payment options described in the table. If the discount rate is 13.73 percent, which of the assertions is true?

Option

Terms of payment (amount and timing)

from Orange Valley Packaging to Red Royal Consulting

A

13,132 dollars in 1 year(s)

B

21,720 dollars in 5 years

C

42,087 dollars in 10 years

Orange Valley Packaging should prefer option A more than option B, and Orange Valley Packaging should prefer option C more than option A

Orange Valley Packaging should prefer option A more than option B, and Orange Valley Packaging should prefer option A more than option C

Orange Valley Packaging should prefer option B more than option A, and Orange Valley Packaging should prefer option A more than option C

Orange Valley Packaging should prefer option B more than option A, and Orange Valley Packaging should prefer option C more than option A

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Shipping Finance A Practical Handbook

Authors: Stephenson Harwood

4th Edition

1787421406, 978-1787421400

More Books

Students also viewed these Finance questions