Consider a training program that will result in a worker receiving a one time bonus of $2,900 two years from now. The cost of the training program is $2,000. What is the rate of return on this investment?
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Consider a training program that will result in a worker receiving a one time bonus of $2,900 two years from now. The cost of the training program is $2,000. What is the
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- if Age dependency ratio (% of working-age population) increase what will happen to fixed capital consumption?Betty will need $12,000 in five years to pay for a major overhaul on her tractor engine. She has found an investment that will provide a 5% return on her invested funds. How much does Betty need to invest today so she will have her overhaul funds in five years?Your firm has the opportunity to buy a perpetual motion machine to use in your business. The machine costs $1,000,000 and will increase your profits by $75,000 per year. What is the internal rate of return? Instructions: Enter your response as a percent rounded to one decimal place. The internal rate of return is percent.
- Although appealing to more refined tastes, art as a collectible has not always performed so profitably. During 2003, Sotheby’s sold the Edgar Degas bronze sculpture Petite Danseuse de Quatorze Ans at auction for a price of $10.45 million. Unfortunately for the previous owner, he had purchased it in 1999 at a price of $12.89 million. What was his annual rate of return on this sculpture?Betty will need $12,000 in five years to pay for a major overhaul on her tractor engine. She has found an investment that will provide a 5% return on her invested funds. How much does Betty need to invest today so she will have her overhaul funds in five years? Illustrate your solution by drawing CFD.Yogajothi is thinking of investing in a rental house. The total cost to purchase the house, including legal fees and taxes, is $240,000. All but $30,000 of this amount will be mortgaged. He will pay $1700 per month in mortgage payments. At the end of two years, he will sell the house and at that time expects to clear $50,000 after paying off the remaining mortgage principal (in other words, he will pay off all his debts for the house and still have $50,000 left). Rents will earn him $2500 per month for the first year and $2900 per month for the second year. The house is in fairly good condition now, so he doesn't expect to have any maintenance costs for the first six months. For the seventh month, Yogajothi has budgeted $500. This figure will be increased by $50 per month thereafter (e.g., the expected month 7 expense will be $500, month 8, $550, month 9, $600, etc.). If interest is 6 percent compounded monthly, what is the present worth of this investment? Given that Yogajothi's…
- Yogajothi is thinking of investing in a rental house. The total cost to purchase the house, including legal fees and taxes, is $230,000. All but $40,000 of this amount will be mortgaged. He will pay $1500 per month in mortgage payments. At the end of two years, he will sell the house and at that time expects to clear $50,000 after paying off the remaining mortgage principal (in other words, he will pay off all his debts for the house and still have $50,000 left). Rents will earn him $2000 per month for the first year and $2400 per month for the second year. The house is in fairly good condition now, so he doesn't expect to have any maintenance costs for the first six months. For the seventh month, Yogajothi has budgeted $300. This figure will be increased by $50 per month thereafter (e.g., the expected month 7 expense will be $300, month 8, $350, month 9, $400, etc.). If interest is 6 percent compounded monthly, what is the present worth of this investment? Given that Yogajothi's…Yogajothi is thinking of investing in a rental house. The total cost to purchase the house, including legal fees and taxes, is $230,000. All but $20,000 of this amount will be mortgaged. He will pay $1500 per month in mortgage payments. At the end of two years, he will sell the house and at that time expects to clear $40,000 after paying off the remaining mortgage principal (in other words, he will pay off all his debts for the house and still have $40,000 left). Rents will eam him $2500 per month for the first year and $2800 per month for the second year. The house is in fairly good condition now, so he doesn't expect to have any maintenance costs for the first six months. For the seventh month, Yogajothi has budgeted $300. This figure will be increased by $30 per month thereafter (e.g., the expected month 7 expense will be $300, month 8, $330, month 9, $360, etc.). If interest is 6 percent compounded monthly, what is the present worth of this investment? Given that Yogajothi's…What is the principal goal of a firm like CorpCo? As a managerial economist how would you define an ‘optimal decision’ for a firm? The firm is considering investing $300,000 for a period of five years. Expected earnings are $50,000 in year 1, $60,000 in year 2, $75,000 in year 3 and $90,000 in years 4 and 5. Should the firm decide to invest, if the interest rate is 8%? The firm paid a dividend of $6 during the past year and it estimates dividends to grow at 7% annually in the future. Firm’s stockholders require a rate of return of 14%. What would be the expected value of each share today? Which are the two basic risks affecting returns when shareholders value any business? Briefly explain.
- If Microsoft earned 0.85 dollars per share in 2000, what is the rate of interest applied for earnings of 2.10 dollars after ten years?Suppose you buy a share of stock for $10 and sell it for $20; your profit is thus $10. If that happens within a year, your rate of return is an impressive 100% ($10/$10 = 1). If it takes five years, what would be the rate of return on your investment? (See Figure.)How much should they save annually for the next three years if they want to build up Joseph's college fund to $31,000, assuming a 5 percent rate of return and ignoring taxes on the interest?