Answer:
The present value of the contract is 0.5% higher if the rent is paid at the beginning of the month. That is equal to $11.28 for every $100 of rent.
Explanation:
if the rent is paid at the beginning of the month, the present value of the lease contract will be:
PV = monthly rent x PV annuity due factor
we are not given the monthly rent, but we know the PV annuity due factor for 0.5% and 24 periods = 22.67568
if the rent is paid at the end of the month, the PV = monthly rent x PV ordinary annuity factor
the PV ordinary annuity factor, 0.5%, 24 periods = 22.56287
assuming that the rent is $100 (just to calculate a %), the PV of an annuity due = $2,267.57
the PV of an ordinary annuity = $2,256.29
the difference between them = [($2,267.57 / $2,256.29) - 1] x 100 = 0.5%
Answer:
The future value in 5 years is $3,184.87
Explanation:
The figure is arrived by calculating the future of the yearly total service of $600($3*200) by using applicable annuity factor for each of the years from year 1 to 5.
The annuity factor for each year is calculated as (1+r)^n, where r is the rate of return of 2% and the n the year in which the service fee relates to.
Kindly find attached for detailed computations.
Answer:
Combined Beta = 1
Combined return = 10%
Explanation:
given data
stock portfolio = $50,000
beta = 1.2
expected return = 10.8%
beta = 0.8
expected return = 9.2%
standard deviation = 25%
to find out
combination
solution
we get here first Combined Beta that is express as
Combined Beta = 1.2 × 50% + 0.8 × 50%
Combined Beta = 1
and
Combined return will be here
Combined return = 10.8 × 50% + 9.2 × 50%
Combined return = 10%
6.4%
200 from the 5% of 4000
140 from 4% on 3500
160 on 6.4% on 2500
