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Inessa05 [86]
2 years ago
15

Becka borrowed $420 from her cousin at the rate of 8% per year. If the inflation rate was 2.5% that year, what is her cousin's a

ctual rate of return on the loan?
Business
1 answer:
sergij07 [2.7K]2 years ago
6 0

Answer:

5.37%

Explanation:

Real rate of return = \frac{1 + NominalRate}{1 + InflationRate} -1

= \frac{1+0.08}{1+0.025} - 1

= 0.053658 or 5.37%

The cousin loaned $420 to Becka

she would expect Becka to pay back 420 x (1 + 5.37%) which is equal to $442.554

The real return on the loan = \frac{442.55-420}{420} × 100 = 5.37%

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Answer:

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4 0
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Gross domestic product (gdp) is the total market value of all intermediate and final goods and services produced by an economy i
MrMuchimi
A. true
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a report must be sent promptly to FINRA if a registered employee of a member firm for all of the following EXCEPT: A has violate
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D

is ticketed for careless driving

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6 0
2 years ago
"You plan on saving money for retirement in 30 years (t=30) at which time, you wish to have saved $1,000,000. In order to do thi
MissTica

Answer:

<u>X= $15,692.9393</u>

Explanation:

Giving the following information:

Number of years= 30

Final value= 1,000,000

First, deposit $10000 for ten years (last deposit at t=10).

After ten years, you deposit X for 20 years until t=30.

i= 6%

First, we need to calculate the final value in t=10. We are going to use the following formula:

FV= {A*[(1+i)^t-1]}/i

FV= {10000*[(1.06^10)-1]}/0.06= $131807.9494

We can calculate the amount of money to input every year. We need to isolate A:

A= (FV*i)/[(1+i)^n-1]

First, we need to calculate the final value of the $131807.9494

FV= PV*[(1+i)^n]

FV= 131807.9494*1.06)^20= 422725.95

We need (1000000-4227725.95) $577274.05 to reache $1000000

A= (FV*i)/[(1+i)^n-1]

A= (577274.05*0.06)/[(1.06^20)-1]= 15692.9393

<u>X= $15,692.9393</u>

6 0
3 years ago
Stormer Company reports the following amounts on its statement of cash flow: Net cash provided by operating activities was $30,5
DIA [1.3K]

Answer:

$38,500

Explanation:

Sheridan's ending cash balance can be calculated as;

= Beginning cash balance + cash provided by operating activities + cash provided by financing activities - cash used by investing activities

= $5,500 + $30,500 + $13,500 - $11,000

= $38,500

Therefore, the ending cash balance is $38,500

6 0
2 years ago
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