29 Jul GIVE AN EXAMPLE OF HOW YOUR NEWLY ACQUIRED KNOWLEDGE OF TIME VALUE OF MONEY (TVM)
ECO Examine a perfectly competitive firm that you have recently purchased a product from, focusing specifically on how the firm operates relative to the characteristics of the market.
Respond to Natasha answer I frequently visit my local farmer’s market and this would be a good example of perfect competition. There are numerous farmer’s selling the same vegetables and fruits at or around the same price. The characteristics that make this a perfect competition is that there are too many farmers so that none of them can take control of the market. The government is not involved with the market. There are no barriers to enter or leave the market and none of the farmers can control the prices because they are all trying to maximize their profit.
ECO
Examine a perfectly competitive firm that you have recently purchased a product from, focusing specifically on how the firm operates relative to the characteristics of the market.
Respond to Natasha answer
I frequently visit my local farmer’s market and this would be a good example of perfect competition. There are numerous farmer’s selling the same vegetables and fruits at or around the same price. The characteristics that make this a perfect competition is that there are too many farmers so that none of them can take control of the market. The government is not involved with the market. There are no barriers to enter or leave the market and none of the farmers can control the prices because they are all trying to maximize their profit.
FIN
Most of us intuitively understand that a dollar required today does not have the same value as a dollar needed (or utilized) in the future. This is due to several factors including interest rates, compounding factors, discounting factors and financial risk. Compare the total payback for a $100,000, 5%, 15 year mortgage and a $100,000, 5%, 30 year mortgage. Suggest a reason for the difference.
Give an example of how your newly acquired knowledge of Time Value of Money (TVM) calculations could better prepare you for the next negotiation or big-ticket purchase in your life.
Respond to Sarah
When I researched this week’s discussion, I was surprised by my findings. When $100,000 is borrowed at 5% for a 15 year mortgage the monthly payment is $790.79 and the total interest paid is $42,342.85. When $100,000 is borrowed at 5% for a 30 year mortgage the monthly payment is $536.82 and the total interest paid is $93,255.78. Therefore, one can save $50,912.93, if the shorter term is chosen. This is due to compounding interest.
For my next big ticket item, I will definitely chose 0% financing and make sure that the total balance is paid off before the offer expires. Seeing how much interest can be saved from the example above also makes me want to quickly pay off my credit cards and not fall for any high interest loans in the future.
http://www.investinganswers.com/calculators/loan/amortization-schedule-calculator-what-repayment-schedule-my-mortgage-2859
Go to the Federal Reserve web site www.federalreserve.gog. Go to Economic Research and Data and access recent statistical release and the consumer credit. Find average interest rates charged by commercial banks on new automobile loans, personal loans, and credit card plans.
A. Compare the average level of interest rates among the three types of loans.
B. Access Historical data and then consumer credit and compare trends in the cost of consumer credit provided by commercial banks over the past three years.
Find the future value of 10,000 invested now after five years of the annual interest rate is percent
A. What would be the future value if the interest rate is a simple interest rate?
B. What would be the future value if the interest rate is a compound interest rate?
Determine the future values if 5,000 is invested in each of the following situations
A. 5 percent for ten years
B. 7 percent for seven years
C. 9 percent for four years
You are planning to invest 2,500 today for three years at a nominal interest rate of 9 percent with annual compounding.
A. What would be the future value of you investment
B. Now assume that inflation is accepted to be 3 percent per year over the same three years period. What would be the investment’s future value in terms of purchasing power
C. What would be the investment’s future value in terms of purchasing power if inflation occurs at a 9 percent annual rate
Find the present value of 7,000 to be revived one year from now assuming a 3 percent annual discount interest rate. Also calculate the present value if the 7,000 is received after two year.
Determine the present values if 5,000 is received in the future ( i.e., at the end of each indicated time period) in each of the following situations.
A. 5 Percent for ten years
B. 7 percent for seven years
C. 9 percent for four years
Determine the present value if 15,000 is to be received at the end of eight years and the discount rate of 9 percent. How would your answer change if you had to wait six years to receive the 15,000?
Use a financial calculator of computer software program to answer the following question
A. What would be the future value of 15,555 invested now if it earns interest at 14.5 percent for seven years?
B. What would be the future value of 19,378 invested now if the money remains deposited for eight years and the annual interest rate is 18 percent
Use a financial calculator of computer software program to answer the following question
A. What is the percent value of 359,000 that is to be revived at the end of twenty three years if the discount rate is 11 percent
B. How would your answer change in (a) if the 359,000 is to be received at the end of twenty years
Use a financial calculator of computer software program to answer the following question
A. What would be the future value of 19,378 invested now if the money remains deposited for eight years, the annual interest rate is 18 percent, and interest on the investment is compounded semiannually?
B. How would your answer for (a) change if quarterly compounding were used?
Our website has a team of professional writers who can help you write any of your homework. They will write your papers from scratch. We also have a team of editors just to make sure all papers are of HIGH QUALITY & PLAGIARISM FREE. To make an Order you only need to click Ask A Question and we will direct you to our Order Page at WriteDemy. Then fill Our Order Form with all your assignment instructions. Select your deadline and pay for your paper. You will get it few hours before your set deadline.
Fill in all the assignment paper details that are required in the order form with the standard information being the page count, deadline, academic level and type of paper. It is advisable to have this information at hand so that you can quickly fill in the necessary information needed in the form for the essay writer to be immediately assigned to your writing project. Make payment for the custom essay order to enable us to assign a suitable writer to your order. Payments are made through Paypal on a secured billing page. Finally, sit back and relax.
About Writedemy
We are a professional paper writing website. If you have searched a question and bumped into our website just know you are in the right place to get help in your coursework. We offer HIGH QUALITY & PLAGIARISM FREE Papers.
How It Works
To make an Order you only need to click on “Order Now” and we will direct you to our Order Page. Fill Our Order Form with all your assignment instructions. Select your deadline and pay for your paper. You will get it few hours before your set deadline.
Are there Discounts?
All new clients are eligible for 20% off in their first Order. Our payment method is safe and secure.