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- If OMR spot price is 1 OMR=$0.385, and the six month forward premium is 6 %, the forward rate will be ?The annual income from the mine is 100,000 and the life of the mine is 20 years. Find the price that an investor is willing to pay for the mine if he considers that money is worth 5% and if he is to accumulate a sinking fund at 6% in order to replace the capital he invested.Gabe purchases a $500 bond that has 6 remaining semi-annual 6% coupon payments for $450. What would be his return per half year period? Round entry to 1 decimal place. The tolerance is ±0.4.
- Given an EOQ problem modelled below, compute for L (lead time in days). Only final answer is rounded (two decimal places) which means that any intermediate value must not be rounded off. For guidance, D is the annual demand and ROP is the reorder point. D = 6,000 units/year EOQ Model Q* ROP = 1/4 of average inventory t L 250 working days (1 year)Deutsche Transport can lease a truck for four years at a cost of €41,000 annually. It can instead buy a truck at a cost of €91,000, with annual maintenance expenses of €21,000. The truck will be sold at the end of four years for €26,000. Ignore taxes. a. What is the equivalent annual cost of buying and maintaining the truck if the discount rate is 10%? Note: Do not round intermediate calculations. Enter your answer in euros. Round your answer to the nearest whole number. b. Which is the better option: leasing or buying? a. Equivalent annual cost b. Better option € 41,000 LeasingA project has an upfront cost (1-0) of $10,000, and it produces annual FCF of $3,000/year from 1-1 through t-7 (seven years). As you can calculate, the net present value of this project, as a stand alone project, without considering inflation, and using a discount rate of 10.0 percent, is $4.605.26. The firm intends to replicate this project out to infinity every seven years, and expects annual inflation to be 4.0 percent for the cash outflows, and 3.0 percent for the cash inflows. That is, the expected cost in Year 7 of replicating this project will be ($10,000) (104) = $13.159.32, and the expected cash inflow in Year 1 will be ($3.000) (1.03)¹ = $3.090. in Year 2 will be ($3.000) (1.03)² $3,182.70, etc. Given this information, and assuming the discount rate remains the same, determine the net present value of this project if it is infinitely replicated and inflation is taken into consideration. $11.315 O $15.804 $9,626 O $8.206 =
- he state of Florida sold a total of $36.1 million worth of lottery tickets at $1 each during the first week of January 2007. As prize money, a total of $41 million will be distributed over the next 21 years ($1,952,381 at the beginning of each year). The distribution of the first-year prize money occurs now, and the remaining lottery proceeds are put into the state’s educational reserve funds, which earn interest at the rate of 6% compounded annually. After the last prize distribution has been made (at the beginning of year 21), how much will be left over the reserve account? (withouth using the excel formulas please!)Quatro Co. issues bonds dated January 1, 2019, with a par value of $880,000. The bonds’ annual contract rate is 13%, and interest is paid semiannually on June 30 and December 31. The bonds mature in three years. The annual market rate at the date of issuance is 12%, and the bonds are sold for $901,670. 2. How much total bond interest expense will be recognized over the life of these bonds?Suppose that the cost of an investment is €12000 and its return is €5000 per year for three years. At the end of the three years, the value of the equipment is zero. Calculate the net present value (NPV) if the discount rate is 5%. Give only a numerical answer with no symbols. Use a point (.) as a decimal separator and nothing as a thousand separator (e.g., 2325.37 and not 2.325, 37).
- Your company has been doing well, reaching $1.18 million in earnings, and is considering launching a new product. Designing the new product has already cost $505,000. The company estimates that it will sell 815,000 units per year for $2.91 per unit and variable non-labor costs will be $1.16 per unit. Production will end after year 3. New equipment costing $1.18 million will be required. The equipment will be depreciated to zero using the 7-year MACRS schedule. You plan to sell the equipment for book value at the end of year 3. Your current level of working capital is $301,000. The new product will require the working capital to increase to a level of $384,000 immediately, then to $406,000 in year 1, in year 2 the level will be $360,000, and finally in year 3 the level will return to $301,000. Your tax rate is 21%. The discount rate for this project is 10.2%. Do the capital budgeting analysis for this project and calculate its NPV. Note: Assume that the equipment is put into use in year…If a project costs $90,000 and is expected to return $24,500 annually, how long does it take to recover the initial investment? What would be the discounted payback period at i = 15% ? Assume that the cash flows occur continuously throughout the year. The payback period is years. (Round to one decimal place.)Your Bank is currently providing the following information: 1) Calculate the bid-ask percentage spread on the 90-day forward £ 2)Calculate the annualised 90-day forward discount on ask for the £