1. 1. You are planning to retire in fifteen years. You'll live ten years after retirement. You want to be able to draw out of your savings of $36,000 per year during your retirement period. How much would you have to invest in equal annual deposits until retirement to meet your objectives? Assume interest rate is 14%.

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2. 2. STERLING TIRE COMPANY Income Statement for the Year Ended December 31, 2022

• Sales (20,000 tires at $60 ) $1,200,000
• Less: Variable costs (20,000 tires at $30) $600,000
• Fixed costs $400,000
• Earnings before interest and taxes $200,000
• Interest expense $50,000
• Earnings before taxes $150,000
• Income tax expense (30%) $45,000
• Earnings after taxes $105,000

What is the degree of operating leverage for the company?

1. 3. Bank A currently charges a 10 % simple rate on a car loan where the interest rate is compounded semiannually. Bank B offers a car loan where the interest rate is compounded quarterly. What simple interest rate would Bank B have to charge in order to earn the same effective annual rate that is earned by Bank A?

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2. 4. Today you get a bank loan of 20.000 TL with an annual interest rate of 16%. You will repay the loan in equal annual installments in the next 4 years. What will be the each equal installment? How much of your second installment will go for interest payment?
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Answer rating: 100% (QA)

1 To meet your retirement objectives you would need to invest approximately 682028 in equal a... View the full answer