a. Calculate the size of the month-end deposits. $542.77 $518.51 $446.40 $496.19 b. How long will it take for the $13,375.00 to accumulate to $39,295.00 if the interest rate remained the same and he continued making the same month-end deposits throughout the term? 4 years and 3 months 5 years and 3 months 3 years and 3 months 3 years and 5 months
Risk and return
Before understanding the concept of Risk and Return in Financial Management, understanding the two-concept Risk and return individually is necessary.
Capital Asset Pricing Model
Capital asset pricing model, also known as CAPM, shows the relationship between the expected return of the investment and the market at risk. This concept is basically used particularly in the case of stocks or shares. It is also used across finance for pricing assets that have higher risk identity and for evaluating the expected returns for the assets given the risk of those assets and also the cost of capital.
A3
Samuel made periodic deposits into a savings account at the end of every month for 2 years. The investments were earning 7.50% compounded quarterly and grew to $13,375.00 at the end of 2 years.
a. Calculate the size of the month-end deposits.
$542.77
$518.51
$446.40
$496.19
b. How long will it take for the $13,375.00 to accumulate to $39,295.00 if the interest rate remained the same and he continued making the same month-end deposits throughout the term?
4 years and 3 months
5 years and 3 months
3 years and 3 months
3 years and 5 months
Step by step
Solved in 2 steps with 2 images