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grow quarterly by 1.2% forever, and the next dividend is due in 3 months and expected to be $3, then
what is the expected annual return on Negan Corp. stock?
Jill buys 10 shares of stock in Costco Corporation at $150 per share on January 30, a membership retailer. During the year, Costco had a dividend of $1.80 per share at the end of June and the stock rose to $164.00 a share. If Jill sold her stock on July 31, what would be her return?
What is her hourly rate of pay if she works a 38-hour week?
What is her holiday pay if she takes two weeks’ leave?
are R23 235 deposit and the rest paid in equal quarterly payments of R13 292,48 at the end
of each quarter for four years. The interest rate is 11,5% per year, compounded quarterly.
Considering the amortisation schedule, the principal repaid during the third quarter of the
first year, is equal to
Date Inflation Index July 2012 =111.5
January 2013=113.1
July 2013= 116.7
January 2014= 120.1
July 2014= 124.2
(a)Calculate the investor’s cash flows from this investment, showing the month in which each cash flow occurs. (4 marks)
(b)Calculate the investor’s effective yield per annum, to closest 1%.(3 marks) (Total 7 marks)
y_n=1/(8(1+e^(-0.25n) ) )
Assuming this is correct and that the term structure of interest rates does not change in the future, calculate:
a) The price per £100 nominal of an 8-year zero coupon bond purchased now. (2 marks)
b) The price per £100 nominal of an 8-year zero coupon bond purchased in 4 years’ time. (3 marks)
c) The one-year forward rate at time 4 years. (3 marks)
d) The 3-year par yield. (4 marks)
(Total 12 marks)
An investor is considering purchasing an office block.
Rental income will be received continuously for 40 years starting at £80,000 per annum. Rents are increased every 4 years at a rate of 3% per annum compound, with the first increase taking place 4 years after purchase.
The investor estimates that £300,000 will need to be spent to refurbish the building 9 months after the purchase date.
The shops are also expected to require regular refurbishment every 4 years for 36 years, with the first such refurbishment taking place at time t = 4 years at an initial cost of £20,000. These regular refurbishment costs are also expected to increase by 3% per annum compound.
The property reverts to its original owner after 40 years for no payment.
Assuming that the investor requires an internal rate of return of 10% per annum and pays no tax, calculate the price that the investor would be willing to pay.
