1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
KonstantinChe [14]
3 years ago
8

Suppose you borrow $10,000 right now to start a business. If the terms of the loan require you to pay back $16,000 in 5 years, w

hat is the implied annual compound interest rate
Business
1 answer:
Alexxandr [17]3 years ago
8 0

Answer:

r = 9.86%

Explanation:

The formula for calculating the future value of an invested amount yielding a compound interest is given by:

FV=PV(1+\frac{r}{n})^{nt}

where:

FV = future value = $16,000

PV = present value = $10,000

r = interest rate = ?

n = number of compounding period per year = 1

t = time in years = 5

∴ 16000=10000(1+\frac{r}{1})^{5}

dividing both sides by 10,000

\frac{16000}{10000} =\frac{10000(1+\frac{r}{1})^{5}}{10000}

1.6 = (1 + r)^{5}

to remove the power of 5, we have to take the 5th root of both sides:

(1.6)^{1/5} = (1 + r )^{5 * 1/5}

Using your calculator:

1.09856 = 1 + r

∴ r = 1.09856 - 1 = 0.09856

r = 0.0986 = 9.86%

∴ r = 9.86%

You might be interested in
Taggart Inc. is considering a project that has the following cash flow data. What is the projects payback? Year 0 1 2 3 Cash flo
nikdorinn [45]

Answer:

The period of payback of the project is 2.30 years. Therefore, the correct answer is C

Explanation:

We will computing the Cumulative Cash Flow from Year 0 to Year 3

Cumulative Cash Flow Year 0 = Cash Flow of Year 0

= -$1,150

Cumulative Cash Flow of Year 1 = Cash Flow of Year 1 + Cash Flow of Year 0

= $500 + (-$1,150)

= -$650

Cumulative Cash Flow of Year 2 =  Cash Flow of Year 2 + Cumulative Cash Flow Cash Flow of Year 1

= $500 + (-$650)

= -$150

Cumulative Cash Flow of Year 3 =  Cash Flow of Year 3 + Cumulative Cash Flow Cash Flow of Year 2

= $500 + (-$150)

= $350

Now, Computing the Pay back period with the formula:

Pay back period = 2 + (Cumulative Cash Flow of year 2 / Cash flow of year 3)

= 2 + (-$150/ $500)

= 2 +  0.3

= 2.3 years

5 0
3 years ago
Which of the following are assumed to remain unchanged along a given short run aggregate supply curve?
sergejj [24]
I had to look for the options and here is my answer:

Given the short run aggregate supply curve, the ones that are believed to stay unchanged along it would be the i<span>nstitutions, such as patent laws and tax systems, that make up the "rules of the game" and the resource prices. (These answers are based on the actual options with this question.)</span>
5 0
3 years ago
Prepare traditional and contribution margin income statements (Learning Objective 6) The Willowick Ice Cream Shoppe sold 8,700 s
Leto [7]

Answer:

Sales Revenues 26100

COGS              <u>    5655</u>

gross profit        20445

rent expense                 1600

depreciation expense   200

operating expense <u>2600</u>

net income                16045

   

Sales Revenues          26100

Variable Cost               <u>     6305 </u>

Contribution margin        19795

rent expense                     1600

depreciation expense       200

fixed operating expense<u>   1950  </u>

net income                   16045

Explanation:

traditional:

COGS

$12 tub / 30 ice cream cones = $0.40

+ 0.25 ice cream cones

total per unit 0.65

8,700 x 0.65 = 5655

Gross profit: sales revenue less COGS

then, we subtract the rent expense, depreicaiton expense and operatign expenses to get net income.

contribution the variable cost will be subtracted from the sales revenues

that will include the 75% of the operating expenses

The difference between sales revenue and variable cost is called contribution margin.

6 0
3 years ago
Which of the following selections effectively use the "you" view.
-Dominant- [34]

Answer:

  • B. Thank you for your letter regarding your CRB2 home entertainment center.
  • D. You are invited to take advantage of our professional development workshops.

Explanation:

The ''you'' view refers to a style of writing where the sender intends to make sure that the focus is on the person receiving the correspondence.

By using the ''you'' view, the receiver becomes the subject of the correspondence such that the text and its contents and are directed at the receiver.

The correct options would be B and D because the options were directed strictly to the receiver and no one else.

4 0
3 years ago
In the dell case study, engineers working closely with marketing, used lean software development strategies and numerous technol
Karolina [17]

In the dell case study, engineers working closely with marketing used lean software development strategies and numerous technologies to create a highly scalable, singular data mart.

<h3>What is Marketing?</h3>

This refers to the act of promoting a business or a good or service to the general public.

Hence, we can see that based on the Dell case study, there was the use of software development strategies to make and develop a highly scalable, singular data mart.

Read more about marketing here:

brainly.com/question/25754149

#SPJ1

7 0
2 years ago
Other questions:
  • Jessie and Preston are both managers at CPA4U, a large accounting firm. Each has a very different management style. Jessie frequ
    11·1 answer
  • Greg's agrees to buy hal's sports store on condition that he is approved by first state bank for the financing. this approval is
    11·1 answer
  • The following are characteristics of the __________ certification: Only law enforcement personnel and government employees worki
    6·1 answer
  • On January 1, 2021, G Corporation agreed to grant all its employees two weeks paid vacation each year, with the stipulation that
    11·1 answer
  • Items that have a useful life of more than one year and used in the business
    5·1 answer
  • Which of the following is an example of an environmental sustainability practice? a. Making sound financial plans to ensure long
    5·1 answer
  • The _______ describes the personal requirements you expect from an employee and can include educational requirements and special
    5·2 answers
  • Strategic alliances almost always result in one company taking over the financial interests of another company true or false
    14·1 answer
  • On January 1, 2018, Tiffany Academy instituted a defined benefit pension plan for its employees. The annual service cost for eac
    14·1 answer
  • What did andy davis do to change eddies behaviour?
    8·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!