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a retailer an account for 20,000 naira from a manufacturer who give two months credit ,but offers a cash discount of 5 percent for prompt payment. the retailer borrow 20000 naira from his bank 9 percent per annum for two months and pays promptly to secure the cash discount. how much does he gain by this transaction?
book with the ISBN: 978-971-0499-31-?
2.Jay's restaurant wants to know if the credit card use by the customer is valid.the credit card number is 4000 0012 3456 7899
c) Differentiate between non-diversifiable risk and liquidity risk.
d) As a trustee of a bond holders, provide two covenants you will insist to be stated in the bond contract. Give reasons for your answer.
b)a firm is considering to buy a machine at $80000. this machine is expected to generate net cash inflow of $28000 each year for six years, after which is expected to be sold at $5oooo.the firm expects to earn at least 14.05% per annum.
5. use NPV and internal rate of return criteria to advise the company on whether the machine should be acquired or rejected.
Kate is applying to USA home loans for a mortgage of $200,000. The company is quoting 10.07% interest per annum. Kate would like to have a 25year amortization period and wants to make a monthly payment.
Required:
What will Kate’s payments be per month?
c) Exim Financial Services granted a loan of $22,000 to its client at 22% compound annual interest to be repaid over the next six (6)years. As a financial adviser to the client you are required to compute the size of the yearly payments.
d) A project costs $910,000 today and offers one million fifty thousand dollars cash flow in 72 months. It has a beta of 95 out of 100 and the risk premium on the market is 7.3%. if the treasury bill rate is 9%, should the project be accepted? Give reason.
