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:
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%:
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.
Answer:
y=1/2x-1
Step-by-step explanation:
-4y=4-2x
4y=4-2x
y=-1+1/2x
y=1/2x-1
Answer: B. 1.96
Step-by-step explanation: a p e x
Answer:
0.19512195122
Step-by-step explanation: