Answer:
- <u>The rate of return is 8.15%</u>
- <u>This is a good investment</u>
<u></u>
Explanation:
For the first question, you need to find the rate that makes the present value of a stream of ten constant annual payments of $15,000 equal to the $100,000 investment.
The formula that returns the present value of a constant payment is called the annuity formula and is:
![Present\text{ }value=payment\times \bigg[\dfrac{1}{r}-\dfrac{1}{r(1+r)^t}\bigg]](https://tex.z-dn.net/?f=Present%5Ctext%7B%20%7Dvalue%3Dpayment%5Ctimes%20%5Cbigg%5B%5Cdfrac%7B1%7D%7Br%7D-%5Cdfrac%7B1%7D%7Br%281%2Br%29%5Et%7D%5Cbigg%5D)
In your problem you know:
- Present value: $100,000
- payment: $15,000
- r: ?
- t: 10
You cannot solve for r directly. You must guess a value and calculate the right side of the equation until to you find the rate that makes it equal to 100,000.
Try 5%:
![\$15,000\times \bigg[\dfrac{1}{0.05}-\dfrac{1}{0.05(1+0.05)^{10}}\bigg]=\$115,826](https://tex.z-dn.net/?f=%5C%2415%2C000%5Ctimes%20%5Cbigg%5B%5Cdfrac%7B1%7D%7B0.05%7D-%5Cdfrac%7B1%7D%7B0.05%281%2B0.05%29%5E%7B10%7D%7D%5Cbigg%5D%3D%5C%24115%2C826)
Then, the rate of return is greater than 5%. After several trials you will find that the rate of return is 8.15%.
Since this rate is higher than 8%, which is what the company requires, this is a good investment.
You draw perpendicular bisectors to find the center of a circle circumscribed about a triangle. Hook me up with 5 stars :)
Answer:
you are dumbbbbbb
Step-by-step explanation:
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Answer:
The weight of cat is <u>14 pounds</u> and the weight of kitten is <u>4 pounds</u>.
Step-by-step explanation:
Given:
Callie has a new kitten. It can weigh 3 pounds less than half the weight of Callie‘s cat. Together the cat and kitten weigh 18 pounds.
Now, to find the weight of each animal:
Let the cat's weight be 
And the kitten weight = 
Total weight of cat and kitten = 18 pounds.
Now, to set an equation to get the weight of each animal:
<em>Multiplying both sides by 2 we get:</em>
<em />
<em />
<em>Adding both sides by 6 we get:</em>
<em />
<em />
<em>Dividing both sides by 3 we get:</em>
<em />
<em />
<em>The weight of cat = 14 pounds.</em>
Substituting the value of 
to get the kitten's weight:
<em>The kitten's weight = 4 pounds.</em>
Therefore, the weight of cat is 14 pounds and the weight of kitten is 4 pounds.
