Ma Practice Question Essay Example

Ma Practice Question Paper Practice Questions: Time Value of Money (TVM) Its Applications in Investments 1. Jose now has $500. How much would he have after 6 years if he leaves it invested at 5. 5% with annual compounding? a. $591. 09 b. $622. 20 c. $654. 95 d. $689. 42 e. $723. 89 N6 I/YR5. 5% PV$500 PMT$0 FV$689. 42 2. How much would $5,000 due in 25 years be worth today if the discount rate were 5. 5%? a. $1,067. 95 b. $1,124. 16 c. $1,183. 33 d. $1,245. 61 e. $1,311. 17 N25 I/YR5. 5% PMT$0 FV$5,000 PV$1,311. 17 3. Suppose the U. S. Treasury offers to sell you a bond for $747. 5. No payments will be made until the bond matures 5 years from now, at which time it will be redeemed for $1,000. What interest rate would you earn if you bought this bond at the offer price? a. 4. 37% b. 4. 86% c. 5. 40% d. 6. 00% e. 6. 60% N5 PV$747. 25 PMT$0 FV$1,000. 00 I/YR6. 00% 4. You sold a car and accepted a note with the following cash flow stream as your payment. What was the effective price you received for the car assum ing an interest rate of 6. 0%? Years:01234 ||||| CFs:$0$1,000$2,000$2,000$2,000 a. $5,987 b. $6,286 c. $6,600 d. $6,930 e. $7,277 I/YR = 6. 0% 01234 CFs:$0$1,000$2,000$2,000$2,000 PV of CFs:$0$943$1,780$1,679$1,584 PV = $5,987Found using the Excel NPV function. PV = $5,987Found by summing individual PVs. PV = $5,987Found using the calculator NPV key. 5. At a rate of 6. 5%, what is the future value of the following cash flow stream? Years:01234 ||||| CFs:$0$75$225$0$300 a. $526. 01 b. $553. 69 c. $582. 83 d. $613. 51 e. $645. 80 I/YR = 6. 5% 01234 CFs:$0$75$225$0$300 FV of CFs:$0$91$255$0$300 FV = $645. 80Found by summing individual FVs. FV = $645. 80Found with the NFV key in some calculators. FV = $645. 80Found with a calculator by first finding the PV of the stream, then finding the FV of that PV. PV of the stream:$501. 99 FV of the PV:$645. 80 6. What’s the future value of $1,500 after 5 years if the appropriate interest rate is 6%, compounded semiannually? a. $1,819 b. $1,915 c. $2,016 d. $2,117 e. $2,223 Years5 Periods/Yr2 Nom. I/YR6. 0% N = Periods10 PMT$0 I = I/Period3. 0% PV = $1,500 Could be found using a calculator, an equation, or Excel. FV = $2,016 Note that we must first convert to periods and rate per period 7. We will write a custom essay sample on Ma Practice Question specifically for you for only $16.38 $13.9/page Order now We will write a custom essay sample on Ma Practice Question specifically for you FOR ONLY $16.38 $13.9/page Hire Writer We will write a custom essay sample on Ma Practice Question specifically for you FOR ONLY $16.38 $13.9/page Hire Writer An investor plans to buy a common stock and hold it for two years. The investor expects to receive $1. 5 in dividend a year and $26 from the sales of the stock at the end of year 2. If the investor wants a 15% return (compound annually), the maximum price the investor should pay for the stock today is roughly: A). $24 B). $28 C). $22 D). $32 E). $26 C). $22 (n=2, pmt = 1. 5, fv = 26, I = 15%, PV = ? ) 8. Morin Companys bonds mature in 8 years, have a par value of $1,000, and make an annual coupon interest payment of $65. The market requires an interest rate of 8. % on these bonds. What is the bonds price? a. $903. 04 b. $925. 62 c. $948. 76 d. $972. 48 e. $996. 79 N8 I/YR8. 2% PMT$65 FV$1,000 PV$903. 04 9. Sadik Inc. s bonds currently sell for $1,180 and have a par value of $1,000. They pay a $105 annual coupon and have a 15-year maturity, but they can be called in 5 years at $1,100. What is their yield to call (YTC)? a. 6. 63% b. 6. 98% c. 7. 35% d. 7. 74% e. 8. 12% N5 PV$1,180 PMT$105 FV$1,100 I/YR = YTC7. 74% 10. Assume that you are considering the purchase of a 20-year, noncallable bond with an annual coupon rate of 9. %. The bond has a face value of $1,000, and it makes semiannual interest payments. If you require an 8. 4% nominal yield to maturity on this investment, what is the maximum price you should be willing to pay for the bond? a. $1,105. 69 b. $1,133. 34 c. $1,161. 67 d. $1,190. 71 e. $1,220. 48 Par value$1,000 Coupon rate9. 5% Periods/year2 Yrs to maturity20 Periods = Yrs to maturity ? Periods/year40 Required rate8. 4% Periodic rate = Required rate/2 = I/YR4. 20% PMT per period = Coupon rate/2 ? Par value$47. 50 Maturity value = FV$1,000 PV$1,105. 69

Dogs And Cats Essays - Cats, Cat, Animal Communication, Dog, Claw

Dogs And Cats Essays - Cats, Cat, Animal Communication, Dog, Claw Dogs and Cats I am going to compare and contrast the similarities and differences between dogs and cats. The similarities are innumerable, yet this holds true with the differences as well. First, we shall discuss the similarities that these two creatures share. One of the most obvious similarities between these two animals is that they both have hair. When a creature has hair, it belongs to the mammal kingdom. This means that they give birth to their young. They also drink milk when they are babies. Another similarity that these animals share is that they are domesticated animals kept as pets. They also require love and affection from their owner. If you show love and affection toward these animals, they will show it back. Another thing that is the same in both of them is that when you pet them, not only does it relieve stress, it gets dog or cat hair every where. They both give birth to multiple offspring at one time, which must be very hard on the mother. Now that I am finished with my explanation of ;the similarities between dogs and cats, I will now discuss with you the differences between these two majestic animals. One of the main differences is that of their species. The cats belong to the family of felines. Dogs, on the other hand, are canines. Another difference is that dogs are pack animals, which means you should spend lots of time with your dog so that it doesn?t get lonely. Cats are loners, meaning they can spend allot of time alone without getting lonely. Another big difference is the sounds that they make. A dog goes woof, bark, growl, or howl. A cat, on the other hand, goes meow and purr. Another difference is their social status, and how they determine their ranks. Cats don?t have any. The determining factor in dogs is the tail. When a cat holds it?s tail up, it means it is happy, but in dogs, how high they hold their tail is how they determine ranks. If one dog meets another dog, and one holds it tail up, it is the one of the higher social class. Another difference is that cats are nocturnal, meaning they go out at night. Dogs, however, are day animals. Another very obvious difference between dogs and cats is that dogs are usually bigger than cats. Cats are usually scared of dogs, and the dogs usually chase the cats. Dogs are also somewhat smarter than cats in the area of verbal command. For example, you can call your dog by name and usually it will come to you, unlike a cat. Also, you can train dogs to do tricks when commanded. Some of the most commonly seen tricks in dogs are role over, fetch, shake hands, sit down, lay down, and play dead. I have never seen a cat do any of these things, and I doubt that I ever will get an opportunity to see a cat preform even one of these tricks. Another difference between cats and dogs is that cats hunt mice, birds, rabbits, and many other types of rodents. A dog will maybe catch a bird, but I have never seen a dog catch a rodent. Here is the reason most people have cats, other than the reason that they are cute, is to catch mice and other rodents. Cats and dogs also hunt in different ways. A dog hunt directly, and when it catches its prey, it kills it immediately. A cat, on the other hand, likes to play with its food, tease it is another way someone described a cat hunting. For example, when a cat sees a mouse, it will pounce on it, then usually claw or bite it, then let it go. It will then pounce on it again, and let it go. Cats will do this for about a half hour before it finally eats its prey. Another difference is their paws and claws. While both of their paws are padded, cats are padded so that they can be stealthy. Their claws are different in the are of sharpness, among other things. Another difference in claws is th at a cats are retractable, while a dog?s aren?t. For