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1 year ago

Why is placing a fraud alert an effective way of dealing with inaccuracies in a credit report?.

1 answer:

3 0

The act placing a fraud alert is an effective way of dealing with inaccuracies in a credit report because its encourages the lenders and creditors to take an extra steps to verify the credit-account holder before issuing credit.

<h3>What do we know as credit report?</h3>

Basically, a typical credit report refers to a statement that has important information about your credit activity and & credit situation such as loan paying history and the status of your credit accounts. Most people in the United States have more than one credit report

The purpose of placing fraud alerts on credit reports is explained as follows. When a fraud alert is placed, its can make it harder for someone to open unauthorized accounts in your name. Also, the action also encourages or requires lenders and creditors to take extra steps to verify your identity such as contacting one by phone before opening a new credit account in your name or making changes to existing accounts.

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You just received a bonus at your job of $4,000 which you decide to put in a saving account at the local bank. Assume that banks

ioda

Answer:

(A) 22,222.22

(B) 57,142.86

Explanation:

we will divide the deposit by the reserve requirement to know how much will expand the money supply.

4,000/0.18 = 22,222.22

4,000/0.07 = 57,142.86

The reasoning behind this multiplier effect is the following:

you deposit 4,000

the bank leave 18% = 920

And lend the remaninder: 3,080

Then, when this are deposit, again takes the minimun reserve and lend the remainder:

3,080 x 18% = 554.4

3,080 - 554.4 = 2,525.6

This process is repeated giving diminished amount to money available to lend. Thus, finding a limit on the division between fund and reserve requirement.

4,000/0.18 = 22,222.22

6 0

3 years ago

Mike is looking for a loan. He is willing to pay no more than an effective rate of 8. 000% annually. Which, if any, of the follo

Alexeev081 [22]

The Loan condition of Loan X and Loan Y will meet the effective rate of 8.00% criteria of Mike.

Computation:

Given,

Effective interest rate =8% $(i_{c})$

Nominal interest rates: $(r)$

Loan X =7.815%, compounded semiannually $(m=2)$

Loan Y: 7. 724% nominal rate, compounded monthly $(m=12)$

Loan Z: 7. 698% nominal rate, compounded weekly $(m=52)$

The formula of the effective interest rate will be used:

$i_{c}=(1+(\frac{r}{m})^{m}-1)$

For Loan X:

$i_{c}=(1+(\frac{r}{m})^{m}-1)$

$i_{c}=(1+(\frac{0.07815}{2})^{2}-1)$

$i_{c}=0.07958 \:0r\: 7.968\%$

As the effective interest rate of Loan X is lower than the actual effective interest rate. Therefore, loan X meets the criteria of Mike.

For Loan Y:

$i_{c}=(1+(\frac{r}{m})^{m}-1)$

$i_{c}=(1+(\frac{0.07724}{12})^{12}-1)$

$i_{c}=0.08003 \:0r\: 8.003\%$

As the effective interest rate of Loan Y is greater than the actual effective interest rate. Therefore, loan Y will not meet the criteria of Mike.

For Loan Z:

$i_{c}=(1+(\frac{r}{m})^{m}-1)$

$i_{c}=(1+(\frac{0.07698}{52})^{52}-1)$

$i_{c}=0.07996 \:0r\: 7.996\%$

As the effective interest rate of Loan Z is lower than the actual effective interest rate. Therefore, loan Z meets the criteria of Mike.

Therefore, in reference to the computation of the effective interest rate of individual loans. The correct option is b. X and Z.

To know more about the effective interest rates, refer to the link:

brainly.com/question/2602223

5 0

3 years ago

What is true about taxes?

Romashka [77]

The answer is b because that’s how the government get paid.

3 0

3 years ago

How do consumer credit counseling services help individuals with excessive debt?

Ulleksa [173]

Answer:

They negotiate with creditors to reduce interest rates and fees

Explanation:

i just did the test and got it right

5 0

3 years ago

Garcia Industries has sales of $187,500 and accounts receivable of $18,500, and it gives its customers 25 days to pay. The indus

Alex Ar [27]

Answer:

Additional net income will be $370.248

So option c is correct option

Explanation:

We have given rate of return on cash generated 8.0%

Total sales $187500

Account receivable = $18500

Days in Year 365

Sales per day = $=\frac{187500}{365}=$513.698$

Company DSO = $=\frac{account\ receivable}{sales\ per\ day}=\frac{$18500}{513.698}=36.01$

Industry DSO = 27 days

Difference = Company DSO – Industry DSO = 36.01-27 = 9.01

Cash flow from reducing the DSO = Difference × Sales per day = 9.01×513.698 = 4628.1

Additional Net Income = Return on cash × Added cash flow = 0.08×4628.1 = 370.248

So option (c) will be correct option

4 0

4 years ago