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Unformatted text preview: a) Based on effective interest rates, in which bank would you prefer to deposit your money? (4) WashingtonPacific invests $4 million to clear a tract of land and to set out some young pine trees. The trees will mature in 10 years, at which time WashingtonPacific plans to sell the forest at an expected price of $8 million. What is WashingtonPacifics expected rate of return? (5) Your company is planning to borrow $1,000,000 on a 5year, 15%, annual payment, fully amortized term loan. What fraction of the payment made at the end of the second year will represent repayment of principal?...
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This note was uploaded on 04/18/2008 for the course FIN 332 taught by Professor Dasilva during the Spring '08 term at CSU Fullerton.
 Spring '08
 DASILVA
 Annuity, Future Value

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