Answer:
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Explanation:
If<em> the investment yield 6% per year</em>, each year its value is multiplied by 1.06.
After 2 years, the value is multiplied by 1.06², after 3 years it is multiplied by 1.06³, and so on.
After n years, the value is multiplied by 1.06ⁿ.
You want that <em>the investment quadruples</em>, thus the multiplicative factor is 4, meaning that you want to solve for:
If you do not know logarithms, you can solve by succesive iterations:
- 1.06² = 1.1236
- 1.06⁴ = 1.2625
- 1.06¹⁰ = 1.79
- 1.06²⁰ = 3.2
- 1.06³⁰ = 5.7
- 1.06²⁵ = 4.29
- 1.06²⁴ = 4.05
- 1.06²³ = 3.82
Thus, <em>if an investement yields 6% per years</em>, it takes 24 years t<em>he investment to quadruple in value.</em>
If you know logarithms, you can make n the subject of the equation:

Again, the solution is 24 years.
Answer:
the GDP deflator but not in the consumer price index
Explanation:
GDP deflator is the ratio of : Nominal GDP (value of goods & services at current prices) to Real GDP (value of goods & services at constant prices), multiplied by 100.
It reflects change in price level of all domestically produced final goods in an economy, during given years.
Consumer Price Index (CPI) indicates price change in market basket of consumer goods & services purchased by households. It is statistically measured based on weighted average of various market basket commodities.
A decrease in price of domestically produced industrial robots : will effect (reduce) GDP deflator, as it includes all final goods & services. But it will not effect CPI as it includes only household consumer goods.
Answer:
A 10% drop in the value of invested assets would cause the value of the account to decrease by $500
Explanation:
Leverage is a way in which companies can use borrowed capital to use in an investment. The leverage stands to multiply the profits of the investments if the investment proves profitable, however if the investment registers a loss, the loss is also multiplied.
In our case;
Initial value of assets=$1,000
leverage=5:1
A 10% drop means;
Decrease in value of account before leverage=percentage drop×initial value of assets
Decrease in value of account before leverage=(10/100)×1,000=$100
If we apply a leverage of 5:1,
Account decrease after leverage=100×5=$500
A 10% drop in the value of invested assets would cause the value of the account to decrease by $500
Answer:
The answer is 7.61%
Explanation:
N(Number of periods) = 15 years
I/Y(Yield to maturity) = ?
PV(present value or market price) = $1,165
PMT( coupon payment) = $95
FV( Future value or par value) = $1,000.
We are using a Financial calculator for this.
N= 15; PV = -1165; PMT = 95; FV= $1,000; CPT I/Y= 7.61
Therefore, the Yield-to-maturity of the bond is 7.61%
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I hope this helped you