I and my husband Jose have total amount of $150,000 in our savings account. We have 3 school going kids. We want to buy a new home, a new car and keep funds for children higher education.

We finalized to buy a home for $760,000. We may use $120,000 of our savings as a down payment on it. For balance financing the mortgage specialist/agent gave us the following options:

1. Option 1: a 25-year mortgage/loan, with semi-monthly payments (at the end of each period). The interest rate on the mortgage is 3.26% APR (annual percentage rate) compounded semi-annually.

Ques 1. What will the semi-monthly payment be on the Option 1 mortgage?

Please use (display + name) the excel function/ formula. Also please attach the screenshots/ photos of the excel sheet solution.

Option 2: a monthly payment of $2,900 to be made at the end of each period. The interest rate with this option would be 3.60% APR (annual percentage rate) compounded semi-annually.

Ques 2. How many years will Option 2 mortgage be amortized over?

Please use (display + name) the excel function/ formula. Also please attach the screenshots/ photos of the excel sheet solution.

Ques 3. To buy a new car of $45,000 (including taxes). In exchange of our old car for $10,000 and $10,000 from our savings as a down payment, the car dealer would provide the $25,000 balance as a 5-year loan paid semi-monthly at 4.8% APR compounded semi-monthly. What will the payment be on the loan for the car as per below information?

Please use (display + name) the excel function/ formula. Also please attach the screenshots/ photos of the excel sheet solution.

Read the case study, then answer the questions that follow.

Case study (questions 5-9)

Susannah’s husband Andrew has found out that Joe has been offering lifts to Susannah and the children. He has made a formal complaint to Joe’s supervisor, Betsy. He has threatened to stop his wife and children attending the centre if Joe continues to work with Susannah and has requested a female worker to support his family.  

Susannah has requested a female support worker, saying she would feel more comfortable and says her husband will allow her to continue attending the centre if she has a female support worker.

Jenny is appointed as Susannah’s support worker. Susannah asks for some information about Domestic Family Violence (DFV) services in the local area. She has also asked if she can come to Jenny’s house if she feels unsafe in her own home at any time. Jenny has explained that she cannot offer Susannah accommodation in her house, but she can refer her to a women’s refuge service if Susannah needs this. Jenny feels very strongly about DFV issues and when she was younger she was in a violent relationship herself.

9. What rights does Susannah have in this situation? Identify at least three rights that Susannah has in your answer. (Approx. 15 words that you can present in a bullet point list if you wish).

1. Consider the production possibility frontier for a simple two-good (closed) economy. Quantities of good x produced are plotted on the horizontal axis. Quantities of good y produced are plotted on the vertical axis. Suppose that the production of both x and y depends only on labor input and that the production functions for these goods are: x = f(l_x) = l_x and y = f(ly) = l_y. Total labor supply is limited by: l_x + l_y = 100. The typical individual’s utility function is given by U(x,y) = x·y. The equilibrium price ratio p_x*/p_y* is equal to [r]. (NOTE: Write your answer in number format, with 2 decimal places of precision level; do not write your answer as a fraction. Add a leading zero and trailing zeros when needed. HINTS: First derive the production possibility frontier equation.)

On a 100-acre farm, a farmer is able to produce 3,000 bushels of wheat when he hires 2 workers. He is able to produce 4,400 bushels of wheat when he hires 3 workers. Which of the following possibilities is consistent with the property of diminishing marginal product?

Group of answer choices

The farmer is able to produce 5,600 bushels of wheat when he hires 4 workers.

The farmer is able to produce 5,400 bushels of wheat when he hires 4 workers.

The farmer is able to produce 5,200 bushels of wheat when he hires 4 workers.

Any of the above could be correct.

The marginal seller is the seller who

Group of answer choices

cannot compete with the other sellers in the market.

would leave the market first if the price were any lower.

can produce at the lowest cost.

has the largest producer surplus.

Ben is considering acquiring a new automobile that he will use 100% for business. The purchase price of the automobile would be $64,500. If Ben leased the car for five years, the lease payments would be $875 per month. Ben will acquire the on January 1, 2020. The inclusion dollar amounts from the IRS table for the next five years are $63, $140, $208, $251, and $289. Ben wants to know the effect on his adjusted gross income of purchasing versus leasing the car for the next five years. He does not claim any available additional first-year depreciation. Write a letter to Ben to present your calculations. Then prepare a memo for the tax files on these matters. Ben's address is 150 Avenue I Memphis, TN 80800

Please clearly explain the calculations and explain how to write the letter and memo.

1. Classify this news event as Systematic or Unsystematic and indicate whether prices will increase or decrease.

US home construction drops 30.2% in April as virus rages.

2. Classify this news event as Systematic or Unsystematic and indicate whether prices will increase or decrease.

Home Depot's sales soared in the first quarter, despite an increase in costs due to the coronavirus.

3. Classify this news event as Systematic or Unsystematic and indicate whether prices will increase or decrease.

Walmart says it will discontinue Jet, which it acquired for $3B in 2016

4. A stock with a price of $10 per share must have a lower market capitalization than a stock with $100 per share.

On January 1, 2020, Suncadia (lessee) leased 100 golf carts from the manufacturer, Yakima Inc. (lessor) for a 7-year period.

Pertinent information follows:

• Lease term is 7 years.
• The first annual payment of $30,000 is due at the inception of the lease.
• The remaining annual lease payments are all at 31 December each year.
• At the end of the lease term, Suncadia can buy the golf carts at a price below the fair value of the golf carts.
• Suncadia’s year end is December 31. The estimated useful life of the golf carts is 10 years.
• Suncadia’s borrowing rate is 6%.
• Fair value of the golf carts is $190,000.

Required:

1. Calculate the present value of the lease payments.
2. Prepare the amortization table.
3. Classify the lease agreement.
4. Prepare the journal entry(ies) for the lessor and the lessee for the 2020 fiscal year related to the lease arrangement.

On January 1, 2020, Suncadia (lessee) leased 100 golf carts from the manufacturer, Yakima Inc. (lessor) for a 7-year period.

Pertinent information follows:

• Lease term is 7 years.
• The first annual payment of $30,000 is due at the inception of the lease.
• The remaining annual lease payments are all at 31 December each year.
• At the end of the lease term, Suncadia can buy the golf carts at a price below the fair value of the golf carts.
• Suncadia’s year end is December 31. The estimated useful life of the golf carts is 10 years.
• Suncadia’s borrowing rate is 6%.
• Fair value of the golf carts is $190,000.

Required:

1. Calculate the present value of the lease payments.
2. Prepare the amortization table.
3. Classify the lease agreement.
4. Prepare the journal entry(ies) for the lessor and the lessee for the 2020 fiscal year related to the lease arrangement.

On January 1, 2020, Suncadia (lessee) leased 100 golf carts from the manufacturer, Yakima Inc. (lessor) for a 7-year period.

Pertinent information follows:

• Lease term is 7 years.
• The first annual payment of $30,000 is due at the inception of the lease.
• The remaining annual lease payments are all at 31 December each year.
• At the end of the lease term, Suncadia can buy the golf carts at a price below the fair value of the golf carts.
• Suncadia’s year end is December 31. The estimated useful life of the golf carts is 10 years.
• Suncadia’s borrowing rate is 6%.
• Fair value of the golf carts is $190,000.

Required:

1. Calculate the present value of the lease payments.
2. Prepare the amortization table.
3. Classify the lease agreement.
4. Prepare the journal entry(ies) for the lessor and the lessee for the 2020 fiscal year related to the lease arrangement.

(Conceptual Question) Address the following questions pertaining to capital structure theories:

• What does the MM theory with no taxes (i.e., perfect capital markets) state about the value of a levered firm versus the value of an otherwise identical but unlevered firm? What does this imply about the optimal capital structure?
  

• Why does the MM theory with corporate taxes (otherwise markets are perfect) lead to 100% debt?
  

• According to the static trade-off theory, if a firm went from zero debt to successively higher levels of debt, why would you expect its stock price to first rise, then hit a peak, and then begin to decline?
  

• Explain how asymmetric information and signals affect capital structure decisions.
  

• Which capital structure theories does the empirical evidence seem to support? What issues should managers consider when making capital structure decisions?