Define what is the present value of these returns

timer Asked: Apr 4th, 2014

Question description

1.  Marcia Stubern is planning for her golden years. She will retire in 20 years  at which time she plans to withdraw $60,000 annually. She is expected to live for 20 years following her retirement. Her financial advisor thinks she can earn 9% annually. How much does she need to invest each year to prepare for her financial needs after her retirement?

2.  Samauel Johnson invested in gold 1 ounce "double eagle" U.S. coins ten years ago, paying $185 at that time. He could sell these coins for $734 today. What rate of return did he earn on this investment?

3.  The Swell Computer Company has developed a new line of desktop computers. It is estimated that the cash return generated by the new product line will be $800,000 / year for the first 5 years and then $500,000 / year for 3 year after that. The cash returns occur at the end of each year. Using a discount rate of 9%, what is the present value of these returns?

4.Ten years ago Harold black bought 100 shares of common stock of Country Homes for $37.50 per share. He just sold them  (ten years later) for a total of $9,715.02 Assume there were not any dividend payments during this 10 years. What was Harold's rate of return.

5. Mr. Sullivan is borrowing  $2 million to expand his business. The loan will be for 10 years at 12% and will be repaid in equal quarterly installments. What will the amount of the quarterly payments be?

I must show my work on each problem, Thank you for you help!!!

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