Question
1) You make a single investment in a contract that offers the annual returns stated in the column.What is the value of your contract when
1) You make a single investment in a contract that offers the annual returns stated in the column.What is the value of your contract when it matures at the end of year ten.You can use the FVSCHEDULE function in EXCEL, only enter a number in the format, 3,4236.07
time | contractual rates of interest |
1 | 5% |
2 | 6% |
3 | 7% |
4 | 8% |
5 | 9% |
6 | 10% |
7 | 11% |
8 | 12% |
9 | 13% |
10 | 14% |
2) You make a single investment in a contract that offers the annual returns stated in the column.What is the value of your contract when it matures at the end of year ten.You can use the FVSCHEDULE function in EXCEL, only enter a number in the format, 3,4236.07
time | contractual rates of interest |
1 | 2% |
2 | 3% |
3 | 4% |
4 | 5% |
5 | 6% |
6 | 7% |
7 | 8% |
8 | 9% |
9 | 10% |
10 | 11% |
3) Assume you must pay taxes on the returns you when you sell them. You invested in the common stock of facebook when it was selling for $30 per share. It now sells for $185 six years later. You are going to sell the 100 shares you bought. What is your after tax annual return on this investment. You must pay 20% of your gains in capital gains tax to the U.S. government. Your annual return is over 20% per year.
4) Assume you do not pay taxes on investment returns you when you sell. You invested in the common stock of facebook when it was selling for $30 per share. It now sells for $185 six years later. You are going to sell the 100 shares you bought. What is your annual rate of return on this investment. Your annual return is over 40% per year.
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started