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please i need the answer for all the following questions The following set-up pertains to questions 20 and 21 You might invest in an asset
please i need the answer for all the following questions
The following set-up pertains to questions 20 and 21 You might invest in an asset that will return after-tax cash flow to you of $2,200 per month for 5 months (first payment one month from now), followed by $3,500 per month for 4 months. You make an offer to buy the asset so that you'll get your "target" annual rate of return of 15.7% (compounded monthly ). 20. PV3bm Find PV given an investment's return stream and target rate of return What is your offer price? a. $28,171 b. $34,087 e. $30,988 c. $23,282 d. $25,610 21. PV3cm Find the actual ROR given an investment's return stream, target ROR, and counteroffer purchase price Instead, however, the seller makes a counter-offer that is $950 higher than your offer. If you buy at the counter-offer price, and receive the expected cash flows, what is your annual rate of return? a. 10.0% b. 6.8% c. 9.1% d. 8.3% e. 7.5% 22. AM5A How long to reduce principal by half Your friend is taking out a mortgage for $153,000 at 9.80% repayable with monthly payments over 25 years. She respects your financial expertise and asks "how many payments will I have to make before I reduce the principal balance by half its original amount." You pull out your calculator, and tell her the number of payments she'll make to reduce the balance by half is: a. 300 b. 248 c. 205 d. 272 e. 225 The following set-up pertains to questions 20 and 21 You might invest in an asset that will return after-tax cash flow to you of $2,200 per month for 5 months (first payment one month from now), followed by $3,500 per month for 4 months. You make an offer to buy the asset so that you'll get your "target" annual rate of return of 15.7% (compounded monthly ). 20. PV3bm Find PV given an investment's return stream and target rate of return What is your offer price? a. $28,171 b. $34,087 e. $30,988 c. $23,282 d. $25,610 21. PV3cm Find the actual ROR given an investment's return stream, target ROR, and counteroffer purchase price Instead, however, the seller makes a counter-offer that is $950 higher than your offer. If you buy at the counter-offer price, and receive the expected cash flows, what is your annual rate of return? a. 10.0% b. 6.8% c. 9.1% d. 8.3% e. 7.5% 22. AM5A How long to reduce principal by half Your friend is taking out a mortgage for $153,000 at 9.80% repayable with monthly payments over 25 years. She respects your financial expertise and asks "how many payments will I have to make before I reduce the principal balance by half its original amount." You pull out your calculator, and tell her the number of payments she'll make to reduce the balance by half is: a. 300 b. 248 c. 205 d. 272 e. 225 Step by Step Solution
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