1) Your employer asks you to consult on the better approach to a decision. What should the corporation pay for an asset that will return them $200,000 at the end of year 1, then zero in year 2, then $600,000 in years 3 & 4, then zero in year 5, then $400,000 in years 6-10, assuming their discount rate is 5% (ignoring taxes) ?

2) A company had interest expense in 2020 of $1,475,000 and is in a 21% tax bracket. What is the after tax cost of interest for this company?

3) You apply for a mortgage loan on a $150,000 condo using 75% loan-to-value. Going interest rates are 5.25%, but after thoroughly surfing the net, you find a lender to grant you a loan at 4.25%. and jump on it. Its a 30-year loan paid monthly. How much interest would you save during the first 10 years of the loan now that youve found the lower interest rate?

4) You have really gone above and beyond in spending on your fraternity initiation party and ran up $2,500 on your parents credit card. You apologize to them and promise to pay $50 per month towards paying off the balance fully. You know that the credit card interest rate is 18%. How long will it take you to fully pay off your good times?

a. Almost 8 years

b. About 5 and a half years

c. About 9 years

d. It depends