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Sauron [17]
3 years ago
7

n investor has $100,000 invested in an account that earns 5% annually. The investor wishes to withdraw $12,000 per year. If the

investor withdraws $12,000 annually, the account will be fully depleted in:

Business
1 answer:
lawyer [7]3 years ago
3 0

Answer:

11 years

Explanation:

For computing, the number of years or the account will be fully depleted we need to apply the NPER formula i.e to be shown in the attachment below:

Given that,  

Present value = $100,000

Future value = $0

PMT = $12,000

Rate of interest = 5%

The formula is shown below:

= NPER(Rate;PMT;-PV;FV;type)

The present value come in negative

So, after applying the above formula, the number of years in which the account is depleted is 11 years

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Answer:

Answer:

Growth rate (g) = n-1√(<u>Latest dividend)</u>     - 1

                                      Current  dividend

                          = 4-1√($2.49/2.20)   -1  

                         = 3√(1.1318)  -1  

                        = 1.04  -  1

                        = 0.04 = 4%

Ke = Do<u>(1 + g) </u>  +  g

               Po

Ke =  $2.57(<u>1  +  0.04</u>)  + 0.04

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Ke = 0.04 + 0.04

Ke = 0.08 = 8%

Explanation:

In this  case, we need to calculate the growth rate using the above formula. Then, the cost of equity will be  calculated. Cost of equity is a function of current dividend paid subject to growth rate divided by current market price.

Explanation:

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4 years ago
Assets, costs, and current liabilities are proportional to sales. Long-term debt and equity are not. The company maintains a con
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Missing information:

<u>Balance sheet </u>

Current assets $3,300 Current liabilities $2,200

Fixed assets       $10,200 Long-term debt $3,750

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Total               $13,500 Total               $13,500

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Taxable income $1,350

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EFN = [($13,500 / $6,600) x $1,188] - [($2,200 / $6,600) x $1,188] - [(0.135 x $7,788 x (1 - 0.35)]

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Answer:

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Answer:

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