The present value of cash flow will be greater if we compound less frequently holding the stated interest rate constant. true
<h3>What is
interest rate constant?</h3>
A proportion that compares a loan's annual debt service to the sum of its principal is known as a loan constant. The annual debt service is divided by the total loan amount to determine a loan constant. Borrowers can compare the loan constants of several loans when looking for a loan before choosing one. The loan with the lowest loan constant will have reduced debt service obligations, resulting in a shorter length of time during which the borrower will pay less in interest and principal. Only loans with fixed interest rates are subject to loan constants; loans with variable interest rates are not.
A loan constant is a ratio that illustrates the annual debt service of a loan in relation to the entire loan principal.
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Answer:
$18
Explanation:
Since the manufacturer sold twice as many units of Q than P, that means it at least sold 1 unit of P and 2 units of Q.
to determine the arithmetic mean (average) revenue per unit:
total revenue = P + 2Q = $20 + (2 x $17) = $20 + $34 = $54
arithmetic mean (average price) = $54 / 3 = $18
Answer: a. $73,810.88
b. $10,185.18
Explanation:
a. The payments of $11,000 are constant so this can be considered an Annuity.
The cost of the Computer is it's present value which is,
Present Value of Annuity = Annuity Payment * Present Value Interest Factor of Annuity, 11%, 10 periods
= 11,000 * 6.71008 (Payment is made at the end of the year so this is an Ordinary Annuity)
= $73,810.88
b. When an Annuity is instead paid at the beginning of the period it is considered to be an Annuity due.
The formula is the same but for the figures ,
Present Value of Annuity Due = Annuity * Present Value Interest Factor of an Annuity Due, 11% , 10 periods
73,810.88 = Annuity * 7.24689
Annuity = 73,810.88/7.24689
= $10,185.18
Answer:
b. $60
Explanation:
Produced surplus = Price producer is able to sell - Price producer would be willing to sell
Price the producer is able to sell = Producer surplus + Price producer would be willing to sell
= $100 + ($15 + $25 + $40)
= $180 for 3 lawn
Therefore, if Ronnie charges are customers the same price for lawn mowing, that price is
= $180 / 3
= $60
Is a microeconomics law that states, all other factors being equal, as the price of a good or service increases, consumers demand for the good or service will decrease, and vice versa
