1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
Elodia [21]
3 years ago
13

You're trying to save to buy a new $180,000 Ferrari. You have $32,000 today that can be invested at your bank. The bank pays 5.0

percent annual interest on its accounts. How long will it be before you have enough to buy the car
Business
1 answer:
Keith_Richards [23]3 years ago
4 0

Answer:

Given an annual interest rate of 5%, it will take 35.4 years to accumulate $180,000.

Explanation:

Giving the following information:

Future Value (FV)= $180,000

Present value (PV)= $32,000

Interest rate (i)= 5%

<u>To calculate the number of years (n) to reach the objective, we need to use the following formula:</u>

<u></u>

n= ln(FV/PV) / ln(1+i)  

n= ln(180,000/32,000) / ln(1.05)

n= 35.4

Given an annual interest rate of 5%, it will take 35.4 years to accumulate $180,000.

You might be interested in
Indigo Ink Supply paid a dividend of $5 last year on its common stock. It is expected that this dividend will grow at a rate of
pychu [463]

Answer:

a.

1st $5.43

2nd $5.89

3rd $6.39

4th $6.93

5th $7.52

6th $7.81

b.

$75.85

Explanation:

Dividend is the payment to the stockholders out of earning of the company. Companies have a dividend policy which determine the future dividend payments.

Dividend of each year can be calculated by using the growth rate as a discount in the compounding formula.

Dividend Payment

First year = $5 x ( 1 + 8.5% )^1 = $5.43

Second year = $5 x ( 1 + 8.5% )^2 = $5.89

Third year = $5 x ( 1 + 8.5% )^3 = $6.39

Fourth year = $5 x ( 1 + 8.5% )^4 = $6.93

Fifth year =$5 x ( 1 + 8.5% )^5 = $7.52

Sixth year = $7.52 x ( 1 + 3.8% )^1 = $7.81

b.

Intrinsic value of the stock is the present value of all the associated dividends

We need to calculate the present value of all the dividend payment.

First year = $5.43 x ( 1 + 11.5% )^-1 =  $4.87

Second year = $5.89 x ( 1 + 11.5% )^-2 = $4.74

Third year = $6.39 x ( 1 + 11.5% )^-3 = $4.61

Fourth year = $6.93 x ( 1 + 11.5% )^-4 = $4.48

Fifth year = $7.52 x ( 1 + 11.5% )^-5 = $4.36

After fifth year the dividend will be discounted as follow

PV of dividend after fifth year = [ $7.81 / (11.5% - 3.8%) ] x [ (1+11.5%)^-6 ] = $52.79

Intrinsic Value of Stock = Sum of PV of all dividends = $4.87 + $4.74 + $4.61 + $4.48 + $4.36 + $52.79 = $75.85

6 0
3 years ago
The consumer price index is the:
Dmitry [639]

Answer:

B. cost of a market basket of goods and services typically consumed in the current period.

5 0
3 years ago
Read 2 more answers
Rawls would agree with the idea that inequalities can be justified if they are based on home-country values. redistribute wealth
Leto [7]

Answer:

benefit those in the worst position.

Explanation:

Rawls theory is based on the concept that no inequalities shall prevail in the country. Although some inequalities are unavoidable.

In those circumstances, when Rawls shall agree to such inequalities, and in-fact, further states that it shall benefit all the people. But for this he states that those in the worst position shall be benefited first and with maximum.

This shall create an equality as these people facing inequality will not be criticised further for any purpose, if they are paid off well in the first instance only.

3 0
3 years ago
Kristen Lu purchased a used automobile for 8,000 at the beginning of last year and incurred the following operating costs:
love history [14]

Fixed cost per mile 0.32 =(1600+1200+360+40)/10000.

Kristen Lu purchased a second user automobile for 8,000 at the start of last year and incurred the subsequent operatingcosts:8,000atthebeginningoflastyearandincurredthefollowingoperatingcosts ($8,000 ÷5 years) Insurance Garage rent Automobile tax and license Variable operating cost​$ 1.600 $ 1.200 $ 360 $ 40 $ 0.14 per mile​$The variable expense consists of gasoline, oil, tires, maintenance, and repairs. therefore the annual straight-line depreciation is$1,600.

The car is kept in a very garage for a monthly fee. Kristen drove the car 10,000 miles last year. Compute the typical cost per mile of Owning and operating cost of the the car.  What costs above are relevant during this decision? Kristen is considering buying an upscale sports car to interchange the car she bought last year.

She would drive the identical number of miles irrespective of which car she owns and would rent the identical parking zone. The sports car's variable operating costs would be roughly identical because of the variable operating costs of her old car.

learn more about operating cost: brainly.com/question/2115053

#SPJ4

3 0
1 year ago
Suppose you hit a 0.058-kgkg tennis ball so that the ball then moves with an acceleration of 10 m/s2m/s2. If you were to hit a b
daser333 [38]

Answer:

1 m/s2

Explanation:

The force on a body ( which is a pull or push) is given by the formula

F = Ma

where F is the force, a is the acceleration and M the mass of the body

Therefore, given that the same force is applied to both bodies,

0.058 × 10 = 0.58 × a

a = 0.058 × 10/0.58

a = 1  m/s2

The acceleration of the basketball will be 1 m/s2.

8 0
3 years ago
Other questions:
  • Many government? programs, such as unemployment? compensation, operate on a deficit during recessions and a surplus during perio
    6·1 answer
  • When one party breaches a contract, the other party can choose from one or more of several_____________ . Generally, a court wil
    6·1 answer
  • Last year Rocco Corporation's sales were $225 million. If sales grow at 6% per year, how large (in millions) will they be 5 year
    8·1 answer
  • Sunset Corp. currently has an EPS of $2.09, and the benchmark PE for the company is 18. Earnings are expected to grow at 6.5 per
    9·1 answer
  • 19. Colombia produces coffee with less labor and land than any other country; it therefore surely has Select one: a. an absolute
    12·1 answer
  • On 12/31/2020, Heaton Industries Inc. reported retained earnings of $425,000 on its balance sheet, and it reported that it had $
    8·1 answer
  • Amelia loves to splurge on clothes. However, when she was out shopping the other day, Amelia bought much less than she usually d
    6·1 answer
  • Dinham Kennel uses tenant-days as its measure of activity; an animal housed in the kennel for one day is counted as one tenant-d
    8·1 answer
  • Y3K, Inc., has sales of $6,229, total assets of $2,845, and a debt-equity ratio of 1.6. If its return on equity is 12 percent, w
    5·1 answer
  • Suppose the risk free interest rate is 3% and the return on the market portfolio of stocks is 8%. The alpha company has beta of
    10·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!