Again, in addition to the original problem statement, you now believe that Investments 4 and 5 should be considered mutually exclusive. What is the present worth for the optimum portfolio? $ x Your answer is incorrect.
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- You have an investment opportunity that promises to pay you $18,000 in four years. You could earn a 5% annual return investing elsewhere. What is the maximum amount you would be willing to invest in this opportunity? Note: Use tables, Excel, or a financial calculator. Round your final answer to nearest whole dollar amount. (FV of $1, PV of $1, FVA of $1, PVA of $1, FVAD of $1 and PVAD of $1)Assume you are told that by investing $100,000 now, you will receive $10,000 per year starting in year 5 and continuing forever. If you accept the offer, the rate of return on the investment is:a. 4% per yearb. between 6% and 7% per year c. between 7% and 10% per yeard. over 12% per yearYou are able to invest $100 at the end of 1 year into an investment earning 6%. At the endof year 2, you are going to add $1,000 to this investment and at the end of year 3, you are going to addanother $1,000. What will the investment be worth at the end of year 3?
- You are offered an investment that will pay you $2000 in one year, $4000 the next year, $6000 the next year, and $8000 at the end of the next year. You can earn 12 percent on very similar investments. What is the most you should pay for this one? How would this be entered In excel?As an investor, you have an opportunity to make an investment in real estate costing $100,000 today. This investment would provide you with monthly cash income of $650 at the end of each month for 20 years (240 months). What is the internal rate of return (IRR)? (We take 20 years into account without selling the property, and the IRR is the annual rate of growth that your investment is expected to generate.) • Please provide both the IRR and RATE function results in an Excel file.You currently have $8,700 to invest. You can invest the full amount now for a period of 9 years at which time you want to have $15,000. Approximately what rate of return is needed to accomplish this investment goal? O 6.50% O 6.24% O 4.65% 5.59%
- You have started an investment club with your friend. You identified an account which you think will pay 8% per year. You are going to invest $1200 per year. Your friend is going to invest $100 per month. You plan to invest for 4 years. All else equal, which of the following is true. Select one: a. Your investment will have the higher future value. b. Both investments will have the same future value c. Your friend’s investment will have the higher future value.Today, you have $35,000 to invest. Two investment altenatives are available to you. One would require you to invest your $35,000 now; the other would require the $35,000 investment two years from now. In either case, the investments will end five years from now. The cash flows for each altenative are provided below. Using a MARR of 15%, what should you do with the $35,000 you have? E Click the icon to view the altenatives description. A Click the icon to view the interest and annuity table for discrete compounding when the MARR is 15% per year. The FW of the Alternative 1 is $ (Round to the nearest dollar.) The FW of the Alternative 2 is S (Round to the nearest dollar.) V should be selected.An entrepreneur decides to start a business that requires an initial investment of $100,000. It is expected to generate annual cash flows of 25,000 over ten years. If the TREMA of 17% per year capitalizable annually and the IRR of 21.41%, what is the Net Present Value of the project?
- Suppose you invest $3,000 today and receive $10,000 in 25 years. a. What is the internal rate of return (IRR) of this opportunity? b. Suppose another investment opportunity also requires $3,000 upfront, but pays an equal amount at the end of each year for the next 25 years. If this investment has the same IRR as the first one, what is the amount you will receive each year? a. What is the internal rate of return (IRR) of this opportunity? The IRR of this opportunity is%. (Round to two decimal places.) b. Suppose another investment opportunity also requires $3,000 upfront, but pays an equal amount at the end of each year for the next 25 years. If this investment has the same IRR as the first one, what is the amount you will receive each year? The periodic payment that gives the same IRR is $ (Round to the nearest cent.)A real estate investor has come to you with a deal for a property which would cost $400,000 & produce $25000 of income (cash flow) the first year. This income would grow by 5% per year, & at the end of the 10th year the investor projects that the building can be sold for $750,000. What is the annual rate of return you would earn by being apart of this investment?Your finance advisor offers you an investment that promise $200000 in 15 years from now. He said that you will need to contribute an initialinvestment of $45,000 now. Required:a. What rate of interest was used in the computation of this investment offerassuming the rate is compounding annually?b. If you wish to retire in just 10 years from now with the same $200 000and the rate of return is 12%, how much money would you need to invest now?c. If you wish to retire with $250 000, using the same initial investment of$45 000 and the rate of return of 15%, how long will you need to wait beforeyou can retire?