Aloma, a university graduate who started a successful business, wants to start an endowment in her name that will provide scholarships to IE students. She wants the scholarship to provide $10,000 per year and expects the first one to be awarded on the day she fulfills the endowment obligation. If Aloma plans to donate $100,000, what rate of return must the university realize in order to award the $10,000 per year scholarship forever?
What will be an ideal response?
Pi* = A
(100,000 – 10,000)i* = 10,000
i* = 11.1%
You might also like to view...
Nitrogen immobilization usually occurs when low nitrogen materials are turned into the soil and rapid
decay depletes nitrogen in the root zone.
Indicate whether the statement is true or false.South African Gold Mines, Inc. is writing off its $210 million investment using the cost depletion method. An estimated 700,000 ounces of gold are available in its developed mines. This year 35,000 ounces were produced at an average price of $400 per ounce. The depletion for the year is closest to: (choose one)
(a) $2.1 million, which is 15% of the gross income of $14.0 million (b) $2.4 million (c) $10.5 million (d) $42 million, which is 15% of the gross income of $280 million
A(n) ____________________ is a nondestructive tension test performed by the sling manufacturer or an equivalent entity to verify construction and workmanship of a sling.
Fill in the blank(s) with the appropriate word(s).
A note that provides a detailed description of requirements for the type and size of parts or material required is
known as a _____. a. mark b. parts list c. specification d. schedule of parts