A deposit of $5500
eams interest at 7% p.a. compounded monthly for four years. At that time, the
interest rate changes to 9% p.a. compounded quarterly. What is the value of the
deposit three years after the change in the rate of the interest?
13. In how many
years will $3500 grow to $10440 at 8% compounded semi-annually? b% compounded
quarterly?
11. Financial
managers should strive to maximize the current value per share of the existing
stock because:
a. Doing so means
the firm is growing in size faster than its competitors.
b. Doing so increases
the salaries of all the employees.
c. They have been hired for the purpose of
representing the interest of the current shareholders.
d. Doing so
guarantees the company will grow in size at the maximum possible rate.
e. The managers
often receive shares of stock as part of their compensation.
