Question 3 You have just been employed as an investment analyst in an investment bank You took over from someone who left with a number of issues that need answers The issues are itemized below A client just deposited 7,000,000 in one of your investment funds which is currently earning 8 return The bank has advised the client to deposit an additional 4,000,000 at the end of each of the next three years The client would like to know how much the total amount in this investment will be in three years time A client has been offered an investment product which requires that he pays 200,000 in one year, 400,000 the next year, 600,000 the year after, and 800,000 at the end of the following year The client could have earned 12 on similar investments being offered on the market but has decided to take your firms offer How much is this investment worth today assuming the client proceeds to invest Yaa Serwaa, a new client, has just being approached by her bankers that she should come for a loan to by a new flat at Trassaco Valley She only has to pay 632,000 per month on the loan In the loan agreement, the bank is prepared to charge interest of 1 compounded monthly for 48 months How much can Yaa Serwaa borrow Paulina Larbi is applying to Ghana Home Loans for a mortgage of 200,000 Ghana Home Loans is quoting 6 Paulina would like to have a 25 year amortization period and wants to make payments monthly What will Paulinas payments be per month Kassim has just been offered a job at 500,000 a year He anticipates his salary will increase by 5 annually until his retirement in 40 years Kassims required return on any investment is 8 What is the present value of Kassims lifetime salary One of your colleagues is trying to convince Mercer to invest in a special fund your firm has just started Mercer wants to earn an effective annual rate of 12 and is looking at an investment that compounds on a monthly basis What APR must the investment pay so as to convince Mercer to put her money into the fund

The Answer is in the image, click to view ...

Answered step by step

Verified Expert Solution

Link Copied!

Question

1 Approved Answer

Posted on Sep 20, 2024

Question 3 You have just been employed as an investment analyst in an investment bank. You took over from someone who left with a number

Question 3

You have just been employed as an investment analyst in an investment bank. You took over from someone who left with a number of issues that need answers. The issues are itemized below:

A client just deposited 7,000,000 in one of your investment funds which is currently earning 8% return. The bank has advised the client to deposit an additional 4,000,000 at the end of each of the next three years. The client would like to know how much the total amount in this investment will be in three years time.

A client has been offered an investment product which requires that he pays 200,000 in one year, 400,000 the next year, 600,000 the year after, and 800,000 at the end of the following year. The client could have earned 12% on similar investments being offered on the market but has decided to take your firms offer. How much is this investment worth today assuming the client proceeds to invest?

Yaa Serwaa, a new client, has just being approached by her bankers that she should come for a loan to by a new flat at Trassaco Valley. She only has to pay 632,000 per month on the loan. In the loan agreement, the bank is prepared to charge interest of 1% compounded monthly for 48 months. How much can Yaa Serwaa borrow?

Paulina Larbi is applying to Ghana Home Loans for a mortgage of 200,000. Ghana Home Loans is quoting 6%. Paulina would like to have a 25-year amortization period and wants to make payments monthly. What will Paulinas payments be per month?

Kassim has just been offered a job at 500,000 a year. He anticipates his salary will increase by 5% annually until his retirement in 40 years. Kassims required return on any investment is 8%. What is the present value of Kassims lifetime salary?

One of your colleagues is trying to convince Mercer to invest in a special fund your firm has just started. Mercer wants to earn an effective annual rate of 12% and is looking at an investment that compounds on a monthly basis. What APR must the investment pay so as to convince Mercer to put her money into the fund?