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Bond [772]
3 years ago
8

First Financial Auto Loan Department wishes to know the payment required at the first of each month on a $10,500, 48-month, 11%

auto loan. To determine this amount, First Financial would:
A. Multiply $10,500 by the present value of 1.
B. Divide $10,500 by the future value of an ordinary annuity of 1.
C. Divide $10,500 by the present value of an annuity due of 1.
D. Multiply $10,500 by the present value of an ordinary annuity of 1.
Business
1 answer:
julia-pushkina [17]3 years ago
7 0

Answer:

First Financial would divide the $10,500 loan by the present value of annuity due of 1.

The correct answer is C

Explanation:

Present value of annuity formula is used for determining the amount                   of loan payment. Since the payments will be made at the beginning of each month, we will apply the formula for present value of annuity due. In order to determine the amount of monthly payment, we will divide the principal by the present value of annuity due of 1.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            

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Assume that securitization combined with borrowing and irrational exuberance in Hyperville have driven up the value of existing
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Because of this, we'll only consider the financial securities because it increases at a geometric progression unlike underlying assets that increases by arithmetic progression.

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3 years ago
Your boss leaves you a note, asking you to determine the present value of a $1,200,000 payment to be made in six years assuming
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Answer:

so value of the mistake is $311685.71

Explanation:

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What is the dollar value of the mistake

solution

we get here present value that is express as for both rate that is

present value = \frac{FV}{(1+r)^t}

put here value

present value =  \frac{1200000}{(1+0.18)^6}

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As a result of this;

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Now, if the bank holds. $30 million as excess reserves, then money supply could increase by as much as $30 million. This is the smallest amount themoney supply could increase.

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