You want to buy new kitchen appliances 2 years from now, and you plan to save $8

Question

You want to buy new kitchen appliances 2 years from now, and you plan to save $8,200 per year, beginning one year from today. You will deposit your savings in an account that pays 6.2% interest How much will you have just after you make the 2nd deposit, 2 years from now? $15,260 $16,063 $16,908 $17,754 $18,642 Calculate the required rate of return for Everett Expeditions Inc., assuming that (1) investors expect a 4.0% rate of inflation in the future. (2) the real risk free rate is 3 0%, (3) the market risk premium is 5.0%. (4) the firm has a beta of 1.00, and (5) its realized rate of return has averaged 15 0% over the last 5 years. 10.29% 10 83% 11.40% 12.00% 12.60% Bill Dukes has $100, 000 invested in a 2-stock portfolio. $35,000 is invested in stock X and the reminder in invested in stock Y. X's beta is 1.50 and y's beta is 0.70. What is the portfolio's beta? 0.65 0.72 0.80 0.89 0.98

Explanation / Answer

27.

C. $ 16,908

29.

e. 0.98

Investment in year 1 = 8200 After 2year value of 1st investment a = 8200*1.062 = 8708 2nd Deposit b = 8200 Total value at the end of year 2 a+b = 16908

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