Q1 (a) OCBC Bank is offering an interest rate of 7% per annum for fixed depositaccount holder. The minimum deposit amount is RM10,000. If you haddeposited RM20,000 into the fixed deposit account today, how much would itbe worth 10 years later. Compute total returns using compound interest methodand draw the cashflow diagram.(b)An asset cost RM95,000 and has a useful life of 7 years. The salvage value atthe end of 7 years is estimated to be RM10,000. Calculate the annualdepreciation amount and book value using straight line (SL) method.(c)ABC Company Sdn. Bhd want to purchase a labelling machine for producttagging. The machine can be purchased for RM100,000. It requires a minormachine overhaul which cost annually RM3,000. At the end of sixth year, amajor machine overhaul costing RM15,000 will be required. The profit will beresulted in annually RM13,000 for a period of 15 years. This equipment willhave a market value of RM30,000 at the end of year 15. Calculate the singleproject evaluation using Annual Worth AW analysis method, which is preferredif the MARR is 8%.

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Q1 (a) OCBC Bank is offering an interest rate of 7% per annum for fixed deposit account holder. The minimum deposit amount is RM10,000. If you had deposited RM20,000 into the fixed deposit account today, how much would it be worth 10 years later. Compute total returns using compound interest method and draw the cashflow diagram.

Q1 (a) OCBC Bank is offering an interest rate of 7% per annum for fixed deposit account holder. The minimum deposit amount is RM10,000. If you had deposited RM20,000 into the fixed deposit account today, how much would it be worth 10 years later. Compute total returns using compound interest method and draw the cashflow diagram.

Essentials Of Investments

11th Edition

ISBN:9781260013924

Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Chapter1: Investments: Background And Issues

Section: Chapter Questions

Problem 1PS

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(b) Suppose that you took out PTPTN loans totalling RM24000 with interest of 1% per year. You have an online payment plan which deducts savings from your bank account at a rate of RM100 per month. (Hint: Assume that the rate is evaluated based on the current balance of the loan.) (1) Write the initial value problem for the situation above. State all variables and the quantities they represent.
Q7: You have just received OMR200M from a bank by requesting a loan. Without any deduction you have intended to invest the amount in a project. At the end of investment period the project will provide you 250M with the interest rate of 10%. a) Find out the number of years for this investment. b) What will be future value from the founded number of years in part (a) if the interest rate changes from 10% to 8%. c) What will be present value if the interest rate is 12%? d) What will be the future value if the number of year is 8 and interest rate is 9%? e) What will be present value if the interest rate is 5% and number of period is 8 compounded Semi-annually?
A company wants to make a single deposit now so it will have enough money to purchase a beckhoe costing $60000 seven years from now A) if the account will earn interest of 12% per year, the amount that must be deposit can be calculated as? B)if the account will earn interest of 12% per year, the amount that must be deposited now is nearest to Option a)60,000 (F/P.12%7b.$27,138c 60,00 (P/F, 12%7d.$29,256e60,000 (F/A, 12%,7)f $28,326
A company would like to have $400,000 in 6 years. How much should be invested semiannually into an account paying 3.6% compounded semiannually? 7. Identify the type of problem. a. Present Value with compound interest b. Future Value of an Annuity c. Present Value of an Annuity d. Amortization e. Sinking Fund 8. Answer the question in the problem. a. $30,681.38 b. $29,754.02. c. $34,245.54 d. $30,160.79 c. $28,541.46
Give the Given, solution and cash flow diagram Benchie owns a legal instrument, due three years hence, whose maturity value is P6,700.48. What is the value of this note now if the rate of interest is ten percent compounded semi-annually? A.P5,000.00 B. P4,020.29 C. P2,010.14 D. P335.00
1. Future Value For each of the cases shown in the following table, calculate the future value of the single cash flow deposited today and held until the end of the deposit period if the interest is compounded annually at the rate specified. Part Single CF Interest Rate Deposit Period (Years) PV I/Y N A $900 3% B $1200 6% C $16,000 9% D $40,000 10% 6 8 12 15
Assume you have the following asset and liability in your Balance Sheet: Asset - Bond A Modified Duration = 2.6 years Value = RM1.5 million Liability - Bond B Modified Duration = 3.1 years Value = RM1.0 million a. Calculate the duration gap. b. What is the expected change in Net Worth if interest increases by 1%? Assume previous interest is 10% c. What should or could you to achieve immunised balance sheet? Note: Please show all workings.
Q3: Which one of the following two cases would you prefer as more profitable investment and why? Case 1: Deposit £5000 for two years in a saving account that pays simple interest at rate of 6% per annum. No withdrawal during the investment period. Case 2: Deposit £5000 for one year in a savings account that pays simple interest at rate of 6% per annum. Then, withdraw the money with interest and deposit into another account paying simple interest at 7.5% for one year. Case 1 because of higher return of £6600 Case 1 because of higher return of £5697.5 Case 2 because of higher return of £5697.5 Case 2 because of higher return of £6600
Suppose you receive cashflows of $10 at year 1, $12 at year 2, $14 at year 3 and $16 at year 4. What would be the value of the cashflows at year 2 at a 5% annual interest rate? MUST SHOW FULL WORK (NO EXCELL) a. 38.3458 b. 50.3458 c. 42.0000 d. 12.0000 e. 49.3621
1. The return of an investment is given in the following table: Year Balance RM5000 1 RM5375 2 RM5697.50 RM5925.40 (a) Find the effective rate of interest for each of the three years. (b) Find the equivalent level effective rate of return over the three-year period. If a principal of RM7000 is invested at time t = 0, calculate the balance of the (c) investment after 3 years.
Q1/ Ipswich Corporation is considering an investment opportunity with the expected net cash inflows of $300,000 for four years. The residual value of the investment, at the end of four years, would be $70,000. The company uses a discount rate of 14%, and the initial investment is $290,000. Calculate the NPV of the investment. Present value of an ordinary annuity of $1: 12% 13% 14% 15% 0.893 0.885 0.877 0.87 2 1.69 1.668 1.647 1.626 3 2.402 2.361 2.322 2.283 4 3.037 2.974 2.914 2.855 3.605 3.517 3.433 3.352 Present value of $1: 12% 13% 14% 15% 1 0.893 0.885 0.877 0.87 0.797 0.783 0.769 0.756 3 0.712 0.693 0.675 0.658 4 0.636 0.613 0.592 0.572 0.567 0.543 0.519 0.497 Q2/ A company is evaluating an investment. The company uses the straight-line method of depreciation. Use the following information to compute the accounting rate of return. Show your calculations and round to one decimal place. Project Investment SR875,000 Residual value Operating income: Year 1 120,000 Year 2 120,000 Year…
If you deposit RM25,000 in an account earning an interest of 15% per annum, how much would you have in the account after 10 years? А. RM 92,890 В. RM 125,789 C. RM 168,980 D. RM 101,140

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