Answer: $36,173.622
Explanation:
Cameron:
Annual Payment = $27,833
Time Period(n) = 44 years
Discount Rate(r) = 6%
![Present\ Worth=Annual\ Payment\times[\frac{(1-(\frac{1}{1+r})^{n} }{r}]](https://tex.z-dn.net/?f=Present%5C%20Worth%3DAnnual%5C%20Payment%5Ctimes%5B%5Cfrac%7B%281-%28%5Cfrac%7B1%7D%7B1%2Br%7D%29%5E%7Bn%7D%20%7D%7Br%7D%5D)
![Present\ Worth=27,833\times[\frac{(1-(\frac{1}{1.06})^{44} }{0.06}]](https://tex.z-dn.net/?f=Present%5C%20Worth%3D27%2C833%5Ctimes%5B%5Cfrac%7B%281-%28%5Cfrac%7B1%7D%7B1.06%7D%29%5E%7B44%7D%20%7D%7B0.06%7D%5D)
= $427,709.711
Kennedy:
Annual Payment = $27,833
Discount Rate = 6%
Present Worth = 
Present Worth = $463,883.333
So, Present Worth of Kennedy is $36,173.622 more than that of Cameron.
Answer:
Net Asset value (NAV)
Explanation:
Net Asset value (NAV) represent per share market value of the fund.It is calculated using the below formula
Net Asset value of fund=Value of mutual fund's portfolio-Mutual fund liabilities/Number of share outstanding.
Mutual fund portfolio normally includes all the cash and securities of a fund.
NAV is normally computed at the end of the end of each trading day based on the closing market prices of the fund portfolio.
Answer:
Risk free rate(Rf) = 1.5%
Market return(Rm) = 8%
Beta(β) = 0.8
ER(P) = Rf + β(Rm – Rf)
ER(P) = 1.5 + 0.8(8-1.5)
ER(P) = 1.5 + 0.8(6.5)
ER(P) = 1.5 + 5.2
ER(P) = 6.7%
Alpha = Annual average return - ER(P)
= 7.2% - 6.7%
= 0.5%
Explanation:
In this case, we will calculate the expected return on the stock based on CAPM. Thereafter, we will calculate alpha by deducting the expected return from annual average return.
It is true that capital gains refer to profits from the sale of investments.
Answer and Explanation:
a)
If you charge $40 for X then everyone will buy as everyone is willing to pay atleast $40. this means all three groups buy that is 3*1000 buyers.So profit from X = 3000*40= $120,000
And since everyone is willing to willing to pay atleast $60 for Y again all three groups will buy so profit from Y =3000*60=$180,000
profits=$300,000
b)
If you charge $90 and $160 for X and Y respectively you will have only 1000 buyers for each product as others are unwilling to pay this much.
So profits = 1000*90 + 1000*160=$250,000
c)
for a bundle of X and Y buyers are willing to pay a total of $150, $210 and $200 across the three categories.
So everyone will buy a bundle of 1 X and 1 Y.
profits = 150*3000= $450,000
d)
If you charge $210 only the second will buy as they are willing to pay that much so profits =1000*210=$210,000
Also by selling X at $90 group 1 will buy X; profits=1000*90=$90,000
and by selling Y at $160 group 3 will buy Y; profits=1000*160=$160,000
total profits =$460,000
