# Investment Portfolio Analysis and Optimization

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Running head: ACCOUNTING & FINANCEAccounting & FinanceName of the UniversityName of the studentAuthors note
2ACCOUNTING & FINANCEAnswer to Question 1:Requirement a:Requirement b:ParticularsAmountTotal Value of LotteryA\$200,000Initial WithdrawB\$20,000Investment ValueC=A-B\$180,000Rate of Interest p.a.D10%Deferred Period (in years)E4Future Investment Valueafter 4 yearsF=Cx(1+D)^E\$263,538Monthly Rate of InterestG=D/120.83%Nos. of Monthly PaymentsH180Size of Equal PaymentsI=(GxF)/[1-(1+G)^-H]\$2,832Requirement c:ParticularsAmountAnnual DepositA\$4,000Interest Rate p.a.B5%Nos. of DepositsC11ParticularsAmountTotal Fund DesiredA\$10,000Periodic PaymentsB\$800Interest Rate p.a.C10%Nos. of Payments p.a.D2Compound InterestE=C/D5.00%Total nos. of PaymentsF=NPER(E,B,0,(-A))9.95Nos. of Full PaymentsG=F-0.959Size of Concluding PaymentH=Bx(F-G)\$760
3ACCOUNTING & FINANCETotal Deposit Amount in 2017D=(1+B)xA[{(1+B)^C-1}/B]\$59,669Requirement d:The table, given below, exhibits that the singer would suffer loss for selling the rightsnow.ParticularsAmountAnnual PaymentA\$20,000Interest Rate p.a.B6%Nos. of DepositsC10Present Value of the TotalPaymentsD=(1+B)xA[{1-(1+B)^-C}/B]\$156,034Current Sale Price of FutureRightsE\$150,000Loss on SalesF=E-D(\$6,034)Requirement e:PeriodGrowth in AnnualPaymentsAnnualAnnuityDiscount RateDiscountedAnnuityABCD E=C/((1+D)^A)10%\$1,00012%\$893210%\$1,10012%\$877310%\$1,21012%\$861410%\$1,33112%\$846510%\$1,46412%\$831610%\$1,61112%\$816710%\$1,77212%\$801810%\$1,94912%\$787910%\$2,14412%\$7731010%\$2,35812%\$759Cost of Annuity\$8,244

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