Question: Exercise 1 If you purchase a machine and borrow $126000, what will your approximate monthly payment be if you pay back the loan over 10
Exercise 1 If you purchase a machine and borrow $126000, what will your approximate monthly payment be if you pay back the loan over 10 years. Assume a 6% interest rate. Exercise 2 If you need $50000 in 15 years, how much should you set aside today? Assume an 3% annual return? Exercise 3 You are considering investing $280000 in a project that will generate cash flows of $48000 per year for 8 years and have a salvage value of $40000. If your cost of capital is 11%, what is the net present value (NPV) of the investment? (Put a minus in front of the number if your NPV is negative.) Exercise 3 You are considering investing $280000 in a project that will generate cash flows of $48000 per year for 8 years and have a salvage value of $40000. If your cost of capital is 11%, what is the net present value (NPV) of the investment? (Put a minus in front of the number if your NPV is negative.) Exercise 4 If you want to withdraw $36000 each year for 40 years, how much would you need to have saved today to fund these withdrawals? (Assume a 10% annual return.) Exercise 5 If you invest $80000, how much will it grow to after 10 years? Assume an annual rate of return is 8%
Step by Step Solution
There are 3 Steps involved in it
Get step-by-step solutions from verified subject matter experts
