Question

1. Maybepay Life Insurance Co. is selling a perpetual contract that pays $5,578/year. The contract currently...

1. Maybepay Life Insurance Co. is selling a perpetual contract that pays $5,578/year. The contract currently sells for $187,038. What is the rate of return on this investment? Enter answer with 4 decimals (e.g. 0.1234).

2. You expect to graduate with $11,343 in student loans. The interest rate on your loan is 8 percent compounded monthly and the loan calls for fixed monthly payments. If you repay the loan in 23 years how much are you paying in total interest over the life of the loan? (HINT: you need to calculate the monthly payment first).

Business   Finance   
0 0
Add a commentTranscribed image text
Next >

Homework Answers

Answer #1

SEE THE IMAGE. ANY DOUBTS, FEEL FREE TO ASK. THUMBS UP PLEASE

0 0
Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Log In

Sign Up

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
Live Forever Life Insurance Co. is selling a perpetuity contract that pays $1,400 monthly. The contract...
Live Forever Life Insurance Co. is selling a perpetuity contract that pays $1,400 monthly. The contract currently sells for $75,000. a. What is the monthly return on this investment vehicle? b. What is the APR? c. What is the effective annual rate?
Live Forever Life Insurance Co. is selling a perpetuity contract that pays $1,400 monthly. The contract...
Live Forever Life Insurance Co. is selling a perpetuity contract that pays $1,400 monthly. The contract currently sells for $73,000. a. What is the monthly return on this investment vehicle? b What is the APR? c. What is the effective annual rate?
Live Forever Life Insurance Co. is selling a perpetuity contract that pays $1723 monthly. The contract...
Live Forever Life Insurance Co. is selling a perpetuity contract that pays $1723 monthly. The contract currently sells for $126268. What is the effective annual return on this investment vehicle? (Enter your answer as a percentage, omit the "%" sign in your response, and round your answer to 2 decimal places. For example, 0.12345 or 12.345% should be entered as 12.35.)
Q13 hw 2 Live Forever Life Insurance Co. is selling a perpetuity contract that pays $1,150...
Q13 hw 2 Live Forever Life Insurance Co. is selling a perpetuity contract that pays $1,150 monthly. The contract currently sells for $71,000. Required: (a) What is the monthly return on this investment vehicle? (Click to select)  1.94%  1.62%  61.74%  1.86%  1.38% (b) What is the APR? (Do not round your intermediate calculations.)    (Click to select)  21.38%  20.41%  17.49%  19.44%  17.89% (c) What is the effective annual rate? (Do not round your intermediate calculations.)    (Click to select)  22.33%  19.14%  23.39%  21.27%  20.20% rev: 09_17_2012
Suppose on January 1 you deposit $1000 in an account that pays a nominal, or quoted,...
Suppose on January 1 you deposit $1000 in an account that pays a nominal, or quoted, interest rate of 12%, with interest added (compounded) daily. How much will you have in your account on October 1, or 9 months later? You want to buy a car, and a local bank will lend you $10,000. The loan would be fully amortized over 6 years (72 months), and the nominal interest rate would be 10%, with interest paid monthly. What is the...
1)A 60-year-old grandmother wants a life insurance policy that could replace her annual $55,000 earnings for...
1)A 60-year-old grandmother wants a life insurance policy that could replace her annual $55,000 earnings for the next 10 years. If the long-term interest rate is now 6.2%, how large of a life insurance policy does she need? 2)You can afford monthly deposits of $200 into an account that pays 6.2% compounded monthly. How many months will it be until you have $15,000 to buy a car?
Curly’s Life Insurance Co. is trying to sell you an investment policy that will pay you...
Curly’s Life Insurance Co. is trying to sell you an investment policy that will pay you and your heirs $37,000 per year forever. A representative for Curly’s tells you the policy costs $620,000. At what interest rate would this be a fair deal? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) Interest rate ______________
1. If you deposit $15,000 per year for 23 years (each deposit is made at the...
1. If you deposit $15,000 per year for 23 years (each deposit is made at the end of each year) in an account that pays an annual interest rate of 12%, what will your account be worth at the end of 23 years? 2. You plan to buy a car that has a total "drive-out" cost of $21,100. You will make a down payment of $2,321. The remainder of the car's cost will be financed over a period of 4...
1.) The Maybe Pay Life Insurance Co. is trying to sell you an investment policy that...
1.) The Maybe Pay Life Insurance Co. is trying to sell you an investment policy that will pay you and your heirs $30,000 per year forever. If the required return on this investment is 4.3 percent, how much will you pay for the policy? (Hint: Find PV of perpetuity) 2.) Find the EAR in each of the following cases: a. APR 9% with quarterly compounding b. APR 18% with monthly compounding c. APR 14% with semi-annual compounding 3.) Find the...
Q.1 You deposit $1,000 in your bank account. If the bank pays 4% compounded interest, how...
Q.1 You deposit $1,000 in your bank account. If the bank pays 4% compounded interest, how much will you accumulate in your account after 10 years? What if the bank pays interst on semi-annual basis? Q.2 If you earn 6% per year on your bank account, how long will it take an account with $100 to double to $200? Q.3 Your landscapping company can lease a truck for $8,000 a year(paid at year-end) for six years. It can instead buy...
ADVERTISEMENT
Need Online Homework Help?

Get Answers For Free
Most questions answered within 1 hours.

Ask a Question
ADVERTISEMENT