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olga2289 [7]
3 years ago
13

Explain why making the minimum payment leads to paying the most interest

Business
1 answer:
Rama09 [41]3 years ago
4 0

Paying the minimum interest on an account balance leads to paying the most in interest because you will make the payments over a longer period of time. The sooner you get the balance paid off, the less amount of interest you will pay. Interest stacks on top of each other over the length of time to pay the debt off.

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A municipal bondholder buys a 5 percent coupon annual payment muni bond at a price of $4,900. The bond has a $5,000 face value.
AURORKA [14]

Answer:

6.4%

Explanation:

we need to divide this investor's income in two parts:

  1. dividends are not taxed = $5,000 x 5% = $250
  2. capital gains = (selling price - basis) x (1 - tax rate) = ($4,975 - $4,900) x (1 - 15%) = $75 x 85% = $63.75

total after-tax gains = $250 + $63.75 = $313.75 / $4,900 = 0.064 ≈ 6.4%

3 0
3 years ago
If a firm has a $1,500,000 debt limit before AT kd will change and if taxes are 40% and total equity in the capital structure is
andrew-mc [135]

Answer:

$2,500,000

Explanation:

Break Point = Level of debt / Weight of debt

(100%-40%)

=60%

Hence:

= 1,500,000 / 60%

= $2,500,000

Therefore the debt breakpoint in the MCC schedule will be $2,500,000

6 0
3 years ago
The following information is available for the month of April from the First department of the Armque Corporation: Units Work in
miskamm [114]

Answer:

Direct Materials = 340,000

Direct Labor       = 304,000

Explanation:

The concept of equivalent units measures the number of units to the extend of completion  of inputs added to outputs during the production.

The first step is to determine the units completed and transferred.

units completed and transferred = opening work in process + started during the year - closing work in process

                                                      = 90,000 + 250,000 - 60,000

                                                      = 280,000

then determine the equivalent units of production with respect to direct materials and conversion costs.

<u>Direct Materials</u>

Note : Materials are added in the beginning of the process thus 100 % in all categories.

units completed and transferred (280,000 × 100%) = 280,000

units of closing work in process (60,000 × 100%)    =   60,000

Total                                                                             =  340,000

<u>Conversion Cost</u>

units completed and transferred (280,000 × 100%) = 280,000

units of closing work in process (60,000 × 40%)    =     24,000

Total                                                                             =  304,000

5 0
3 years ago
The grapevine is perceived by most employees as being more believable and reliable than formal communiqués issued by management.
pantera1 [17]

Answer: False

Explanation: Grapevine is an informal communication channel in the organisation in which the information flows  in all directions irrespective of the level of authority.

This is not considered to be a reliable channel as it does not make any authority or obligation to anyone and often leads to false rumors in the organisation. Whereas in the case of formal communiques one can make the authority of the sender of the message if the information lead to any false rumors and chaos.

Thus, the given statement is false.

4 0
3 years ago
A(n) _____ might be sent to a potential employer even when the employer does not have any job openings at the time to be kept on
Whitepunk [10]
It would probably be a résumé because they always hold onto it so they can consider it when there are job openings
5 0
3 years ago
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