If she can earn a return of 10 on any investment she makes


1. John won a lottery she will have a choice of receiving $25,000 at the end of each year for the next 30years, or a lump sum. If she can earn a return of 10% on any investment she makes, what is the minimum she should be willing to accept today as lump sum payment?

2. George nees to capture a return of 40% for his one year investment in a property at the end of the year for $150,000 and that property will provide him with rental income of $25,000. What is the maximum amount George should be willing to pay for the property?

3. The Risk-free return is currently 3%, whereas the market risk premium is 6%. If Beta of Lucky Inc. stock is 1.8 then what is the expected return on Lucky?

4. The expected return on Carol corp stock is 16.5%. if the risk-free is 5% and the beta of Carol Corp is 2.3. what is the risk premium on the market?

Solution Preview :

Prepared by a verified Expert
Finance Basics: If she can earn a return of 10 on any investment she makes
Reference No:- TGS02732133

Now Priced at $10 (50% Discount)

Recommended (91%)

Rated (4.3/5)