Irene invested $27,000 in a twelve-year CD bearing 8.0% interest, but needed to withdraw $6,000 after three years. If the CD’s p
2 answers:
Answer:
Option D.
Explanation:
It is given that Irene invested $27,000 in a twelve-year CD bearing 8.0% interest.
Total interest = Principal × Rate × Time
Principal = $27,000
Rate = 8% = 0.08
Time = 12 years
Irene earn total $25,920 if she had not made her early withdrawal.
If she withdraw $6000 after three years, then the total interest is
If the CD’s penalty for early withdrawal was eighteen months’ worth of interest on the amount withdrawn.
Irene earn total $20880 if she had made her early withdrawal.
Irene earn $5,040 less money if she had made her early withdrawal.
Therefore, the correct option is D.
You might be interested in
A firm expects to sell 25,500 units of its product at $16 per unit. pretax income is predicted to be $60,500. If variable costs are $8 per unit, total fixed costs must be $143,500.
Fixed costs are costs that stay constant no matter changes in production volume, implying that irrespective of whether output rises or decreases, total fixed costs remain constant within the relevant range.
Rent, labor, depreciation, insurance, and other fixed costs per unit fluctuate over the relevant range, on the contrary.
Given,
Selling price = $16
Variable cost per unit = $8
Units sold = 25,500
Pretax income = $60,500
Substituting the provided information into the above calculation yields,
Contribution margin =
= $204,000
Formula:
This symbolizes,
Substituting the provided information into the above calculation yields,
= $143,500
Hence, the answer is $143,500.
Learn more about fixed cost:
#SPJ4