You and your brother inherited a business. You and him would like to split 50/50. Your...

You and your brother inherited a business. You and him would like to split 50/50. Your brother want to sell his half out to you in the future. He told you that he feels this will be when you turn 35 years old. Today, you just turned 22. Today the entire company is worth 500,000$. You expect the growth of 3% per year with this money invested for the next 5 years, then 5% per year for the following 8 years, at which time you will buy your brother's half.

You currently have just 20,000$ of your own money and have to start investing heavily in order to have the money you need when time comes for you to buy your brother out. You invest 20,000$ now. In addition, you find that you can afford to save 1350$ per month starting at the end of the current month and continuing each month for the next five years. After that time, you feel you will be making more money and can put more in the investment account each month. How much do you have to put in each month for those last 8 years in order to have the amount you need by the time you turn 35? the rate is 6.6% compounded monthly.

Expert Solution

jeff jeffy answered 2 years ago

Your brother has asked you to help him with choosing an investment. He has $6,500 to...

Your brother has asked you to help him with choosing an investment. He has $6,500 to invest today for a period of two years. You identify a bank CD that pays an interest rate of 0.0400 annually with the interest being paid quarterly. What will be the value of the investment in two years? Round to two decimal places.

You are looking to start a business after you inherited a rolling setup, like the one...

You are looking to start a business after you inherited a rolling setup, like the one from problem 2. You did a test run and measured P = 250kW, you will use this next. Also, you call you local power provider in Colorado and fin that the energy cost is 11.2 cents/kWh. From a metal producer, you can buy 3/8” thick by 12” wide 6061 aluminum in 36 ft lengths. These are delivered to your warehouse at a cost of...

You would like to start your own business. You collect the following information on the initial...

You would like to start your own business. You collect the following information on the initial costs: Cost of Plant and Equipment = $ 500,000 Licensing and Legal Costs = $ 50,000 You can claim an investment tax credit of 10% on plant and equipment. You also have been left a tidy inheritance that will cover the initial cost, and your estimated opportunity cost is 10%. You estimate that you can sell 1 million bottles a year at $1 a...

f you are advising a new client to open a new business, would you advise him...

f you are advising a new client to open a new business, would you advise him to form a corporation or a single proprietorship as a small business? Explain.

Your COO informed that he would like you to come down and discuss with Strategic Business...

Your COO informed that he would like you to come down and discuss with Strategic Business Unit Manager and Human Resource Office Manager on the execution of the production line improvement project. You are given a chance to hand-picked your project team member and experts. Give your decision on this and provide adequate information of the structure, list of team members and your justification on each position proposed based on the current Covid-19 movement control situation. The company is a...

You would like to open a business in 3 years. This business will require $500,000 to...

You would like to open a business in 3 years. This business will require $500,000 to startup. How much should you deposit at the end of each month for the next three years into an account so that you will have the required $500,000 at the end of three years. This account already has $100,000 in it. The interest rate is 6% compounded monthly.

What changes would you like to see in taxes on business?

Business Planning ( I would like to open restaurants) 1. What kind of business would you...

Business Planning ( I would like to open restaurants) 1. What kind of business would you start? Explain in one or two sentences. 2. How would your business make money? 3. What business expenses would you have?

Jessie just inherited $33,715.57 and would like to use it to buy a new car. His...

Jessie just inherited $33,715.57 and would like to use it to buy a new car. His parents would like him to use the money for college which Jessie will start in 10 years. His parents expect that his college will cost $17,000.00 per year for 4 years (tuition is due at the end of the year). The interest rate on the savings is 6.00%. 1) How much money will Jessie need for college when he starts in 10 years? 2)...

Your friend recently inherited $20,000 from a wealthy relative. His stockbroker has advised him to invest...

Your friend recently inherited $20,000 from a wealthy relative. His stockbroker has advised him to invest in three particular stocks. Because of the volatility of the market, your friend requires the stockbroker to provide him with historical yearly returns for these stocks over the past four years. This data is shown in the table below. Find the efficient frontier of this portfolio. Year Stock A Stock B Stock C 1 0.202 0.109 0.153 2 0.024 0.187 0.068 3 0.159 0.098...

Question