## anonymous one year ago Can someone please check this?

1. anonymous

@jim_thompson5910

2. anonymous

sure

3. anonymous

Gimee a sec ima look over it

4. anonymous

Everything looks fine I'm not sure how to solve 21 tho

5. anonymous

@jim_thompson5910 how would i correct number 2

6. jim_thompson5910

what is the total sum (in dollars) invested in portfolio 1

7. anonymous

not sure

8. jim_thompson5910

add up the dollar figures in column 1 (where it says portfolio 1)

9. anonymous

9250

10. jim_thompson5910

good

11. jim_thompson5910

now multiply each ROR value by the dollar amount in the same row focus on just portfolio 1 for now

12. jim_thompson5910

once you get done multiplying, add up those results and tell me what you get

13. anonymous

i dont understand do i have to multiply every single ror with the total sum

14. jim_thompson5910

ex: multiply -0.004 with 2400 to get -9.60

15. jim_thompson5910

convert each percentage to decimal form

16. anonymous

got them

17. anonymous

i got -9.60,40.82,313.96, -35,and 102.12

18. anonymous

@jim_thompson5910

19. jim_thompson5910

add those up to get ???

20. anonymous

412.3

21. anonymous

????

22. anonymous

@jim_thompson5910

23. jim_thompson5910

finally, divide that by 9250 (the sum of the dollar figures)

24. jim_thompson5910

does that make sense?

25. anonymous

yes

26. anonymous

and i got 0.044572973

27. jim_thompson5910

very good

28. jim_thompson5910

that's the weighted ROR for portfolio 1

29. jim_thompson5910

do the same for portfolio 2 and 3

30. anonymous

ok are the other questions bad by the way like are they alot wrong

31. jim_thompson5910

3 and 4 are wrong

32. jim_thompson5910

I'm on 5 now

33. anonymous

ok

34. jim_thompson5910

tell me what you get for the other weighted ROR's

35. anonymous

ok

36. anonymous

Is the order portfolio 3,2,1 @jim_thompson5910

37. jim_thompson5910

what weighted RORs did you get

38. anonymous

for portfolio 2 i got 0.048797251 and for the portfolio i got 0.087759517

39. jim_thompson5910

very nice

40. jim_thompson5910

so yeah it's 3, 2, 1

41. jim_thompson5910

3 being the best 1 being the worst

42. anonymous

how do i fix 3,4?

43. jim_thompson5910

let's do them one at a time

44. jim_thompson5910

go here http://www.bankrate.com/calculators/mortgages/mortgage-calculator.aspx type in the given mortgage amount, rate, and time

45. jim_thompson5910

then scroll to June 2025, which is exactly 10 years into the future what is the value in the last column?

46. jim_thompson5910

why 10 years? because of the "10" in "30/10" means that the balloon payment hits after 10 years are up the 30 means this is a 30 year fixed mortgage

47. anonymous

168,401.44?

48. jim_thompson5910

good

49. jim_thompson5910

that remaining balance is the balloon payment you either pay it all or refinance it

50. anonymous

ok

51. anonymous

4?

52. jim_thompson5910

Formula $\Large FV = \frac{(1+i)^n - 1}{i}$ FV = unknown i = 0.0635/12 = 0.03175 n = 2*7 = 14

53. anonymous

ok

54. anonymous

I get 17.29035 @jim_thompson5910

55. jim_thompson5910

way too small

56. jim_thompson5910

oh my bad, I left out P

57. jim_thompson5910

that's my fault lol

58. anonymous

its ok @jim_thompson5910

59. jim_thompson5910

$\Large FV = P*\frac{(1+i)^n - 1}{i}$ FV = unknown P = 720*6 = 4320 i = 0.0635/12 = 0.03175 n = 2*7 = 14

60. anonymous

74694.34

61. anonymous

62. jim_thompson5910

yeah I'm realizing that just now lol

63. jim_thompson5910

64. anonymous

its ok. but i probably had more when you continued to look into it @jim_thompson5910

65. anonymous

any more that i had wrong that i need to look into ?

66. jim_thompson5910

5 is correct

67. jim_thompson5910

I'm still on 6

68. anonymous

how is going @jim_thompson5910

69. jim_thompson5910

nearly there, I'm on the origination fee now

70. jim_thompson5910

71. anonymous

how is it going? @jim_thompson5910

72. jim_thompson5910

I keep trying various combinations, but I'm not getting any of the answer choices

73. anonymous

really?

74. anonymous

75. jim_thompson5910

I vaguely remember that, but I don't remember actually calculating out the answer

76. jim_thompson5910

let me think

77. jim_thompson5910

ok I'm only off by about 20 cents at this point, so it's good enough

78. anonymous

its ok #7

79. jim_thompson5910

80. jim_thompson5910

the answer isn't B, unless I forgot something

81. jim_thompson5910

do you have a breakdown of each subtotal?

82. anonymous

nope

83. anonymous

@jim_thompson5910

84. jim_thompson5910

I'm getting this 21956+307080+1776.44+1332.33+1397.2+621.95+12685.08+355.288 = 347,204.288

85. jim_thompson5910

did you get that?

86. jim_thompson5910

or something similar to it?

87. anonymous

i got b at first but i guess

88. anonymous

at least if that at the beginning @jim_thompson5910

89. jim_thompson5910

hmm I'm not sure now, but I think I have the right answer. I'm only off by 20 cents or so. This problem is a pain

90. anonymous

how about the rest how are they @jim_thompson5910

91. jim_thompson5910

7 looks good

92. anonymous

8?

93. anonymous

@jim_thompson5910

94. jim_thompson5910

still thinking

95. jim_thompson5910

do you have the bond rate of return formula?

96. anonymous

I believe it is yield = coupon amount/price

97. jim_thompson5910

that seems too small

98. jim_thompson5910

is there anywhere in your notes that mentions the bond rate of return formula?

99. anonymous

Divide the future value that you seek in a bond by the bond's face value.For example, if you seek a future value of $15,000 from a$5,000 bond, divide $15,000 by$5,000 to get a multiplier of 3. Step 2 Divide 1 by the term of the bond. For example, if you seek the future value of $15,000 after 20 years, divide 1 by 20 to get 0.05. Step 3 Raise the multiplier to the power of this factor. Continuing the example, raise 3 to the power of 0.05 to get 1.056. Step 4 Subtract 1 from the result, to get 0.056. Step 5 Multiply the answer by 100. With this example, this gives a target annual rate of return of 5.6 percent. 100. jim_thompson5910 the issue is that we don't know what future value we want to target 101. anonymous yeah right? 102. jim_thompson5910 what would that future value be? 103. anonymous i am not sure? 104. jim_thompson5910 same here, i guess it's just best to skip 105. jim_thompson5910 question 9 is incorrect 106. jim_thompson5910 the gov bond is the most secure, so it is the less riskiest 107. anonymous so it would be municipal common stock preferred @jim_thompson5910 108. jim_thompson5910 the municipal bond is the safest 109. anonymous whats the second best common stock? 110. jim_thompson5910 the one that isn't under investigation 111. anonymous got it @jim_thompson5910 10? 112. anonymous i used the compound interest formula for 10 113. jim_thompson5910 10 is correct 114. anonymous 11? @jim_thompson5910 115. jim_thompson5910 still working on it 116. jim_thompson5910 hmm I'm getting$660.71 which is too small I think. Let me try again

117. jim_thompson5910

ok I redid it and got $759.69 which is practically$759.70 like you got so it looks good

118. jim_thompson5910

question 12 looks good too

119. anonymous

13?

120. anonymous

question 13 is bound to be wrong @jim_thompson5910

121. jim_thompson5910

not sure yet

122. jim_thompson5910

13 is correct

123. anonymous

14 and 15?

124. anonymous

15 was kind of hard for me @jim_thompson5910

125. jim_thompson5910

14 is incorrect

126. anonymous

how do i fix it? @jim_thompson5910

127. jim_thompson5910

$\Large M = \frac{L*i}{1-(1+i)^{-n}}$ M = unknown L = 375500 i = 0.04325/12 n = 12*20 find M

128. anonymous

3209.255?

129. jim_thompson5910

try again

130. anonymous

2340.27

131. jim_thompson5910

better

132. anonymous

thanks how is 15?

133. anonymous

@jim_thompson5910

134. jim_thompson5910

15 looks good

135. anonymous

16 and 17?

136. anonymous

@jim_thompson5910

137. jim_thompson5910

still thinking on 16

138. jim_thompson5910

16 is correct as well

139. anonymous

how is it @jim_thompson5910

140. jim_thompson5910

does your lesson give any formulas about prorated taxes? I'm trying to figure out what the start date is

141. anonymous

i dont think so

142. anonymous

i have checked

143. jim_thompson5910

these problems frustrate me because I get so very close but not quite there exactly. I'm off by a few dollars

144. anonymous

what did you get?

145. anonymous

@jim_thompson5910

146. jim_thompson5910

one sec

147. jim_thompson5910

Ok I'm getting that she has to pay 1717.78 in taxes and 900.24 in interest Total: 1717.78 + 900.24 = 2,618.02 which is about a dollar off from choice A. So I could be missing something, but idk