## Description

**Question 2**

1. If the effective rate is

19%. 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.

**Question 3**

1.

The ABC Company is considering a new project which will require an

initial cash investment of $14,864. The projected cash flows for years 1

through 4 are $9,722, $9,118, $8,632, and $5,842, respectively. If the

appropriate discount rate is 11%, compute the NPV of the project.

Enter your answer

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

**Question 4**

1. How many months it will

take to grow your money from $4,712 to $7,580 if you can earn an interest of

16% compounded monthly? Note: Do not write “months” in your answer.

Simply write the number in the answer box.

1 points

**Question 5**

1. What is the effective

rate of 18% 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 6**

1. How much do you need to

invest today in order to have $14,899 at the end of 12 years if you are sure to

earn an interest at the rate of 11%? Note: Do not put $ sign in your answer.

Simply write the number in the answer box.

1 points

**Question 7**

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 8**

1. If you can double your

money in 19 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.

**Question 10**

1. How many years it will

take you to quadruple (means 4 times) your money if you can earn 7% each year?

Note: Do not write “years” in your answer. Simply write the number in

the answer box.

1 points

**Question 11**

1. What is the future value

of $359 invested for 10 years at 13% if interest is compounded quarterly? Note:

Do not put $ sign in your answer. Simply write the number in the answer box.

1 points

**Question 12**

1. What is the future value

of annual payments of $6,087 for 17 years at 5 percent?

1 points

**Question 13**

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 14**

1. The Perpetual Life

Insurance Co is trying to sell you an investment policy that will pay you and

your heirs $12,471 per year forever. Suppose the Perpetual Life Insurance Co.

told you the policy costs $180,064. 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 15**

1. If you can triple your

money in 18 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

1 points

**Question 17**

1. What is the future value

of $4,357 invested for 29 years at 18% 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 18**

1. How many years it will

take to grow your money from $3,308 to $9,537 if you can earn an interest of

15% compounded quarterly? Note: Do not write “years” in your answer.

Simply write the number in the answer box.

1 points

**Question 19**

1. What is the future value

of $661 for 15 years at 6 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 20**

1. 026:

Say, you deposit $1,493 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 7 % for first 10 years

and interest of 9 % for the remaining years? Note: Do not put $ sign in your

answer. Simply write the number in the answer box.

1 points

**Question 21**

1. How much do you need to

invest today in order to have $4,498 at the end of 28 years if you are sure to

earn an interest at the rate of 15%, if interest is compounded monthly? Note:

Do not put $ sign in your answer. Simply write the number in the answer box.

1 points

**Question 22**

1. Kelly starting setting

aside funds 6 years ago to buy some new equipment for her firm. She has saved

$607 each quarter and earned an average rate of return of 5 percent. How much

money does she currently have saved for this purpose?

1 points

**Question 23**

1.

Assume interest rate of 3%. A company receives cash flows of $967

at the end of year 5, $316 at the end of year 7, and $624 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 24**

1. How many years it will

take to grow your money from $3,641 to $7,248 if you can earn an interest of

13% compounded monthly? Note: Do not write “years” in your answer.

Simply write the number in the answer box.

1 points

**Question 25**

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 26**

1. What is the future value

of quarterly payments of $562 for 14 years at 6 percent?

1 points

**Question 27**

1.

If you receive $110 at the end of each year for the first three

years and $794 at the end of each year for the next three years. What is the

present value? Assume interest rate is 4%.

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 28**

1. 027:

Say, you deposit $4,879 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 9 years and interest of 6 % 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 29**

1. 023A:

If you can double your money in 23 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 30**

1. Barrett Pharmaceuticals

is considering a drug project that costs $174,959 today and is expected to

generate end-of-year annual cash flows of $13,959, 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

1 points

**Question 33**

1. Assume interest rate of

6%. Suppose that you receive $97,408 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 34**

1. What should you be willing to

pay in order to receive $259 annually forever, if you require 5% per year on

the investment?

Just enter the number up to 2 decimal points. Do

not enter $ in the answer box.

1 points

**Question 35**

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 36**

1. Assume interest rate of

4%. A company receives cash flows of $81,403 at the end of years 4, 5, 6, 7,

and 8, and cash flows of $289,772 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.

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