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Which assertion is true? Person Amount invested Time that funds are invested Annual return on investment Olga 16,294 dollars In 3 year(s) from today 11.1

Which assertion is true?

Person

Amount invested

Time that funds are invested

Annual return on investment

Olga

16,294 dollars

In 3 year(s) from today

11.1 percent

Jabari

29,784 dollars

In 6 year(s) from today

5.96 percent

Eli

33,268 dollars

In 9 year(s) from today

7.97 percent

Jabari will have more money in 12 years than Olga will have in 12 years and Eli will have more money in 12 years than Olga will have in 12 years

Olga will have more money in 12 years than Jabari will have in 12 years and Olga will have more money in 12 years than Eli will have in 12 years

Jabari will have more money in 12 years than Olga will have in 12 years and Olga will have more money in 12 years than Eli will have in 12 years

Olga will have more money in 12 years than Jabari will have in 12 years and Eli will have more money in 12 years than Olga will have in 12 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 16,200 dollars in 5 year(s) from today and has an expected return of 11 percent per year. Investment B is expected to pay 19,500 dollars in 8 year(s) from today and has an expected return of 17.01 percent per year.

3.

Blue Eagle Media just bought supplies from Yellow Sand Banking. Blue Eagle Media has been offered the 3 possible payment options described in the table. If the discount rate is 15.25 percent, which of the assertions is true?

Option

Terms of payment (amount and timing)

from Blue Eagle Media to Yellow Sand Banking

A

22,493 dollars in 1 year(s)

B

52,927 dollars in 7 years

C

70,347 dollars in 9 years

Blue Eagle Media should prefer option B more than option A, and Blue Eagle Media should prefer option C more than option A

Blue Eagle Media should prefer option B more than option A, and Blue Eagle Media should prefer option A more than option C

Blue Eagle Media should prefer option A more than option B, and Blue Eagle Media should prefer option C more than option A

Blue Eagle Media should prefer option A more than option B, and Blue Eagle Media should prefer option A more than option C

4.

Orange Valley Recycling just bought supplies from Red Royal Consulting. Orange Valley Recycling has been offered the 3 possible payment options described in the table. If the discount rate is 13.98 percent, which of the assertions is true?

Option

Terms of payment (amount and timing)

from Orange Valley Recycling to Red Royal Consulting

A

16,468 dollars in 3 year(s)

B

27,614 dollars in 7 years

C

46,682 dollars in 11 years

Red Royal Consulting should prefer option A more than option B, and Red Royal Consulting should prefer option C more than option A

Red Royal Consulting should prefer option B more than option A, and Red Royal Consulting should prefer option A more than option C

Red Royal Consulting should prefer option B more than option A, and Red Royal Consulting should prefer option C more than option A

Red Royal Consulting should prefer option A more than option B, and Red Royal Consulting should prefer option A more than option C

5.Sasha owns two investments, A and B, that have a combined total value of 55,100 dollars. Investment A is expected to pay 24,300 dollars in 5 year(s) from today and has an expected return of 12.01 percent per year. Investment B is expected to pay X in 4 years from today and has an expected return of 17.58 percent per year. What is X, the cash flow expected from investment B in 4 years from today?

6.

Fairfax Paint is planning to sell its McLean, Springfield, and Falls Church stores in T years from today. The firm expects to sell its McLean store for a cash flow of H dollars, its Springfield store for a cash flow of H dollars, and its Falls Church store for a cash flow of M dollars. The cost of capital for the Falls Church store is Q percent, the cost of capital for the Springfield store is W percent, the cost of capital for the McLean store is Q percent, H > M > 0, Q > W > 0; and T > 0. The cash flows from the sales are the only cash flows associated with the various stores. Based on the information in the preceding paragraph, which one of the following assertions is true?

Two of the three stores have equal value and those two stores are more valuable than the third store or all three stores have the same value

The McLean store is the most valuable of the 3 stores

None of the other assertions is true

The Falls Church store is the most valuable of the 3 stores

The Springfield store is the most valuable of the 3 stores

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