Answer:
a. the use of deposits to extend loans and undertake investments.
Explanation:
When you deposit money at a bank, they do not just hold on to all that money. They will loan some of it out to other people and charge them interest for borrowing it. They will also use some of it to purchase investments that earn returns (money). This is the most lucrative source of earnings for commercial banks.
Answer:
Effective monthly rate 2.076%
Yearly nominal rate: 24,912%
Explanation:
In excel we have to specify the number of period. The amount we borrow and the payment we are doing This should be negative as represent a cash outflow.
This is solving for the rate of the annuity for 95 of 12 months that discounted at X rate gives 1,000 as the present value:
we write on A1
=RATE(12;1000;-95)
and we will receive 2.076% as answer
<em><u>Now to convert into nominal:</u></em>
2.076 x 12 = 24,912%
But does business in another country
Answer:
The answer is low
Explanation:
Liquidity or Solvency is the ability of a business to pay its debt(both in short term and long term).
In the question, Coleman Luggage has a liability of 879,000 and the total current assets(which can be used to offset the liability) are cash balance of $175,000 + inventories of $220,000 + Other short-term assets of $85,000 = $480,000.
To know its solvency (net working capital) = Asset - liability
$480,000-870,000
= -$390,000.
Coleman Luggage has a low solvency because his asset cannot cover all his liabilities. His asset is less than his liabilities
