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What are the two methods for estimating debit cost of capital, and what do you do when there is default risk? Explain the circumstances in which you would use each method. Give examples.

Find the future value one year from now of a $7,000 investment at a 3 percent annual compound interest rate. Also calculate the future value if the investment is made for two years. FV one year FV two years Sum of FV’s Find the future value of $10,000 invested now after five years if the

Toyota Motor Credit Corp (TMCC) a subsidiary of Toyota Motor offered some securities for sale to the public on March 28, 2008. Under the terms of the deal, TMCC promised to repay the owner of these securities $100,000 on March 28, 2038, but investors would receive nothing until then. Investors paid TMCC payment 30 years

Explain what is meant by the time value of money, and discuss its relevance to the capital budgeting process.

1) If company B has $100,000 cash today, and invested it at a rate of 10% per year for two years, how much will they have in two years? 2) If Company A offers to pay Company B $121,000 in two years, what is the PV of that $121,000 to Company B? 3) What are

Scenario: Kiddy Toy Corporation needs to acquire the use of a machine to be used in its manufacturing process. The machine needed is manufactured by Lollie Corp. The machine can be used for 10 years and then sold for $10,000 at the end of its useful life. Lollie has presented Kiddy with the following options:

Your annual salary is $100,000. Every year for the next 30 years you plan to save 10 percent of your salary and invest it in the stock market at an expected return of 9 percent per year. 1. How much will you have in your account at the end of 30 years if your salary

Hi, Please explain why the time value of money is important in an economic decision and how NPV and payback period are used in business to incorporate the time value of money into operational decision. Explain the three basic concepts that are used for estimating the cost of ownership for a single option or in

I need guidance on how to calculate gearing using ordinary share, preference share and debt financing and also how to evaluate and make a recommendation on which to use. – Gearing is the relationship between debt and total equity included in the capital structure of a firm. The two items are different due to their

Discuss the impact that increasing inflation will have on your life.