Managerial Finance

1. What is the future value of quarterly payments of $639 for 9 years at 4 percent?

1 points

Question 2

1. What is the future value of $2,623 for 6 years at 10 percent if interest is compounded semi-annually? Note: Do not enter "$" in your answer. Simply write down the number that you get as your answer.

1 points

Question 3

1. 026:
   
   Say, you deposit $1,680 in a bank for 18 years. What is the amount you will have in the bank at the end of 18 years if interest of 4 % for first 8 years and interest of 10 % for the remaining years? Note: Do not put $ sign in your answer. Simply write the number in the answer box.

1 points

Question 4

1. What is the future value of annual payments of $2,778 for 5 years at 7 percent?

1 points

Question 5

1. If you can triple your money in 29 years, what is the implied rate of interest? Note: Do not put % sign in your answer. Simply write the number in percentages in the answer box..

1 points

Question 6

1. Today, you are purchasing a $4,386 12-year car loan at 9 percent. You will pay annually at the end of each year. What is the amount of each payment?

1 points

Question 7

1. Gertrude Carter and Co. has an outstanding loan that calls for equal annual payments of $14,903 over the 10-year life of the loan. The original loan amount was $100,000 at an APR of 8 percent. How much of the third payment is interest?

   Do not enter the symbol $ in your answer. Simply enter the answer rounded off to two decimal points.

1 points

Question 8

1. If you can double your money in 10 years, what is the implied annual rate of interest, given that compounded in quarterly? Note: give your answer in percentages. Note: Do not put % sign in your answer. Simply write the number in percentages in the answer box.

1 points

Question 9

1. 027:
   
   Say, you deposit $3,531 in a bank for 17 years. What is the amount you will have in the bank at the end of 17 years if interest of 6 % compounded monthly for first 8 years and interest of 7 % compounded quarterly for the remaining years? Note: Do not put $ sign in your answer. Simply write the number in the answer box.

1 points

Question 10

1. If you put $700 in a savings account with a 10% nominal rate of interest compounded monthly, what will the investment be worth in 21 months (round to the nearest dollar)?

   	a.	$770
   	b.	$1,176
   	c.	$833
   	d.	$828
   	e.	$827

1 points

Question 11

1. What is the effective rate of 13% compounded monthly?

   Do not enter the symbol % in your answer. Simply enter the answer in percentages rounded off to two decimal points.

1 points

Question 12

1. Assume interest rate of 8%. A company receives cash flows of $106,656 at the end of years 4, 5, 6, 7, and 8, and cash flows of $207,017 at the end of year 10. Compute the future value of this cash flow stream.

   Do not enter the symbol $ in your answer. Simply enter the answer rounded off to two decimal points.

1 points

Question 13

1. If the effective rate is 15%. What is the nominal rate if compounding is daily. Do not enter the symbol % in your answer. Simply enter the answer in percentages rounded off to two decimal points.

1 points

Question 14

1. Kelly starting setting aside funds 8 years ago to buy some new equipment for her firm. She has saved $5,182 each quarter and earned an average rate of return of 8 percent. How much money does she currently have saved for this purpose?

1 points

Question 15

1. If you receive $149 at the end of each year for the first three years and $676 at the end of each year for the next three years. What is the present value? Assume interest rate is 8%.

   Hint: This is an uneven cash flow problem. Use the CF function and solve for NPV to get the answer.

   Just enter the number up to 2 decimal points. Do not enter $ in the answer box.

1 points

Question 16

1. Assume interest rate of 11%. A company receives cash flows of $661 at the end of year 5, $213 at the end of year 7, and $457 at the end of year 10. Compute the future value of this cash flow stream.

   Do not enter the symbol $ in your answer. Simply enter the answer rounded off to two decimal points.

1 points

Question 17

1. In order to buy a house, you take a loan of 100,000 at 7.5% for a period of 13 years. Compute the balance remaining at the end of 5 years.

   Do not enter the symbol $ in your answer. Enter your answer as a positive number. Simply enter the answer rounded off to two decimal points.

1 points

Question 18

1. What should you be willing to pay in order to receive $485 annually forever, if you require 8% per year on the investment?

   Just enter the number up to 2 decimal points. Do not enter $ in the answer box.

1 points

Question 19

1. The Perpetual Life Insurance Co is trying to sell you an investment policy that will pay you and your heirs $10,828 per year forever. Suppose the Perpetual Life Insurance Co. told you the policy costs $157,258. At what interest rate would this be a fair deal? Just enter the number in percentages up to 2 decimal points. Do not enter % in the answer box.

1 points

Question 20

1. How many years it will take you to double your money if you can earn 9% each year, given that compounding is quarterly? Note: Do not write "years" in your answer. Simply write the number in the answer box.

1 points

Question 21

1. 023A:
   
   If you can double your money in 22 years, what is the implied annual rate of interest, given that compounded semi-annually? Note: give your answer in percentages. Note: Do not put % sign in your answer. Simply write the number in percentages in the answer box.

1 points

Question 22

1. Assume interest rate of 7%. Suppose that you receive $72,888 at the end of each year for 4 years. Suppose that this cash flow starts at the end of the fourth year. Compute the present value.

   Do not enter the symbol $ in your answer. Simply enter the answer rounded off to two decimal points.

1 points

Question 23

1. How many years it will take to grow your money from $3,807 to $7,653 if you can earn an interest of 17% compounded monthly? Note: Do not write "years" in your answer. Simply write the number in the answer box.

1 points

Question 24

1. Barrett Pharmaceuticals is considering a drug project that costs $176,677 today and is expected to generate end-of-year annual cash flows of $13,721, forever. At what discount rate would Barrett be indifferent between accepting and rejecting the project?

   Just enter the number in percentages up to 2 decimal points. Do not enter % in the answer box.

1 points

Question 25

1. What is the future value of $1,159 invested for 9 years at 14% if interest is compounded quarterly? Note: Do not put $ sign in your answer. Simply write the number in the answer box.

1 points

Question 26

1. What is the future value of $2,226 invested for 16 years at 17% if interest is compounded semi-annually? Note: Do not put $ sign in your answer. Simply write the number in the answer box.

1 points

Question 27

1. The ABC Company is considering a new project which will require an initial cash investment of $5,753. The project will produce no cash flows for the first 5 years. The projected cash flows for years 6 through 9 are $3,730, $4,568, $2,018, and $3,118, respectively. If the appropriate discount rate is 12%, compute the NPV of the project.

   Enter your answer rounded off to two decimal points. Do not enter $ in the answer box.

1 points

Question 28

1. How many months it will take to grow your money from $4,221 to $6,855 if you can earn an interest of 6% compounded monthly? Note: Do not write "months" in your answer. Simply write the number in the answer box.

1 points

Question 29

1. How much do you need to invest today in order to have $13,346 at the end of 23 years if you are sure to earn an interest at the rate of 9%? Note: Do not put $ sign in your answer. Simply write the number in the answer box.

1 points

Question 30

1. How many years it will take to grow your money from $4,977 to $9,223 if you can earn an interest of 10% compounded quarterly? Note: Do not write "years" in your answer. Simply write the number in the answer box.

1 points

Question 31

1. How much do you need to invest today in order to have $5,692 at the end of 16 years if you are sure to earn an interest at the rate of 13%, if interest is compounded monthly? Note: Do not put $ sign in your answer. Simply write the number in the answer box.

1 points

Question 32

1. How much do you need to invest today in order to have $9,131 at the end of 25 years if you are sure to earn an interest at the rate of 9%, if interest is compounded quarterly? Note: Do not put $ sign in your answer. Simply write the number in the answer box.

1 points

Question 33

1. The ABC Company is considering a new project which will require an initial cash investment of $16,098. The projected cash flows for years 1 through 4 are $8,471, $5,214, $9,122, and $4,961, respectively. If the appropriate discount rate is 10%, compute the NPV of the project.

   Enter your answer rounded off to two decimal points. Do not enter $ in the answer box.

1 points

Question 34

1. What is the future value of $2,029 invested for 6 years at 12% if interest is compounded semi-annually (twice a year)? Note: Do not put $ sign in your answer. Simply write the number in the answer box.

1 points

Question 35

1. Consider a 10-year loan with monthly payments at 10%. If the loan amount is $250,000, compute the Interest paid during the 6^th year.

   Enter your answer rounded off to two decimal points. Do not enter $ in the answer box.

1 points

Question 36

1. How many years it will take you to quadruple (means 4 times) your money if you can earn 16.19% each year? Note: Do not write "years" in your answer. Simply write the number in the answer box.