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making love Group 2, convey you for your work on the first baptismal font.  Your work did countersinkly landed estate the PVA of the 20-year rente of $19718 ($19,720.11 was fine), solely you did not neutralizely state the gross nitty-gritty of income of $29318. -5 points Mr. route can spend: $19,718 + $600 + $9,000 = $29,318 per year Your work did not state the legitimate take account in your courtship of 4.8%.   -5 points (1.09/1.04) - 1 = 0.048 Your host did provide a detailed compend of over the 20-year period with and without the inflationary figures. Your group did not state the correct literal income amount. If Mr. Road wishes to maintain the substantive value of his go up egg account at $12,000, then he willing obligate to increase the balance of the account in form with inflation, that is, by 4% each year. Since the nominal interest rate on the account is 5%, only the first 1% of interest simoleons on the account, or $120 real dollars, is acquirable for spending each year. The other 4% of earnings must(prenominal) be re-invested. So total real income is: $14,200 + $9,000 + $120 = $23,320 -5 points The real sum that can be spent out of go up egg was a payment of $14200. -5 points [Using a financial calculator, usher in: n = 20; i = 4.8; PV = (?)180,000; and then compute PMT = $14,200] Your case analysis did not address all of the individual questions communicate in the chapter 5 case.

 The level of written effort performed on this group assignment was not sufficient.  Please put aside more(prenominal) written analysis efforts in the future case assignments.  -5 points give thanks you for your combined effo rts on this chapter 5 case assignment.  D! r. Woo  cheeseparing Group 2, Questions 1 and 2 addressed the price of the shares.   under the past crop scenario the shares should sell for $333.33.  Under the rapid crop scenario the shares should sell for $384.25. Question 3 addressed the rate of heel counter that should be used for the project.  You will find that the case blab that 11% should be the discount rate.  This was stated in the final examination exam paragraph...If you want to get a full essay, frame it on our website: OrderEssay.net

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