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Zigmanuir [339]
3 years ago
6

You need some money today and the only friend you have that has any is your miserly friend. He agrees to loan you the money you

need, if you make payments of $30 a month for the next six months. In keeping with his reputation, he requires that the first payment be paid today. He also charges you 2 percent interest per month. How much money are you borrowing?a. $164.09b. $168.22c. $169.50d. $170.68e. $171.40
Business
1 answer:
Serggg [28]3 years ago
6 0

Answer:

The correct option is (b)

Explanation:

Given:

Monthly payment for 6 months = $30 per month

Time period = 6 month (6 periods)

Monthly interest rate = 2%

In order to compute borrowed amount, present value of these payments need to be computed which is an annuity as same amount of $30 is paid.

Checking PVIFA table for 2%, 6 periods, annuity factor is 5.6014.

Borrowed amount = Monthly payment × PVIFA(2%,6)

                            = 30 × 5.6014

                            = $168.042

Borrowed amount is $168.042 or $168.22 approximately (difference in value due to annuity factor being rounded off)

                         

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Casey Motors recently reported net income of $55 million. The firm's tax rate was 40.0% and interest expense was $19 million. Th
nadezda [96]

Answer:

$31.76 million

Explanation:

Economic Value Added is the residual wealth left for shareholders after having accounted for the financing needs of the company as shown by the formula below:

EVA=NOPAT-(WACC*invested capital)

NOPAT is the net operating profit after tax =operating profit(EBIT)*(1-tax rate)

Net income=Earnings before tax*(1-tax rate)

net income= $55 million

EBT=unknown

tax rate=40.0%

$55=EBT*(1-40.0%)

$55=EBT*0.60

EBT=$55/0.60

EBT=$91.67

EBIT=EBT+interest

EBIT=$91.67+$19

EBIT=$110.67

NOPAT=$110.67*(1-40%)

NOPAT=$66.41

WACC=9.0%

perating capital employed=$385

EVA=$66.41-(9.0%*$385)

EVA=$31.76 million

operating capital em

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3 years ago
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Is Starbucks bucking the trend of other food-service stores?
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Mhm yeah I think soooo lol
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This is a song lyric "my name is ____ my. my sigh is ____. my number is _____."
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4 0
2 years ago
Read 2 more answers
It costs a family of two $25 to go to the state fair, and a family of six $65. Find the equation, rate of change, and initial va
amid [387]

y = 10x + 5 is the required equation.

<u>Explanation:</u>

A family of two to go to state fair is $25

A family of six to go to state fair is $65

So the 2 points are (2,25) and (6,65)

Rate of change = (y2-y1)/ (x2-x1)

  Plugin the values, we will get,

                           = (65 - 25)/ (6-2)= 40/4 = 10

Equation can be written as,

(y - y₁) / (y₂ - y₁) = (x-x₁)/(x₂-x₁)

(y-25)/(65-25) = (x-2)/(6-2)

(y-25)/ 40 = (x-2) / 4

4(y-25) = 40(x-2)

4y - 100 = 40x - 80

4y = 40x - 80 + 100

4y = 40x + 20

Dividing the equation by 4, we will get,

y = 10x + 5 is the equation required.

4 0
3 years ago
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