t today (single CF) to accumulate $90,000 at the end of 10-years if the rate of
ID: 2798652 • Letter: T
Question
t today (single CF) to accumulate $90,000 at the end of 10-years if the rate of interest is 8 percent compounded annually? A) $37,055.48 B) $37,850.65 C) S38.190.28 D) $41,687.41 E) $43,192.54 3. Suppose the interest rate is 0.4 percent per month and you require a $1,000 CF at the end of every month forever. Hovw much must you invest today to meet this objective? A) $100,000 B) $200,000 C) $250,000 D) $400,000 E) $500,000 4. Suppose total assets are $170 million and net income afte tax is $17 million. What is the return on assets? A) Zero D) 15 percent E) 20 percent B) 5 percent C) 10 percentExplanation / Answer
Correct answer is D
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FV = Initial deposit * FV factor @ 8%, n = 10 years
90000 = X * 2.15892
X = 90000/2.15892
= 41687.41
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