Answer:
48 MONTHS
PV = Down payment + $450(1 - (1 + r/m)-mn - 1)
r/m
PV = $5,000 + $450(1 - (<u>1 + 0.12/12</u>)-12x4 - 1)
0.12/12
PV = $5,000 + $450(1 -<u>(1 + 0.01)</u>-48 - 1)
0.01
PV = $5,000 + $450(37.9740)
PV = $5,000 + $17,088
PV = $22,088
60 MONTHS
PV = $5,000 + $450(1 - <u>(1 + 0.12/12)</u>-12x5 - 1)
0.12/12
PV = $5,000 + $450(1 -<u>(1 + 0.01)</u>-60 - 1)
0.01
PV = $5,000 + $450(44.9550)
PV = $5,000 + $20,230
PV = $22,230
Explanation:
In this case, we need to calculate the present value of the car which is a function of down payment plus the present value of the monthly payments at 12% discount rate.
Answer:
Consumer's surplus is $5 and the producer's surplus is $4.
Explanation:
1) Consumer surplus is the extra amount a consumer is willing to pay for a product above the price they actually do pay.
Consumer surplus = maximum price willing to pay – actual price
Maximum price willing to pay = $25
Actual price = $20
Consumer surplus = $25 – $20
Consumer surplus = $5
Therefore, the customer saved $5 as a consumer surplus which he/she can spend on some other goods or services.
2) Producer surplus is the difference between what price producers are willing and able to sell a good for and what price they actually receive from consumers (market price).
Producer surplus = Actual price – minimum price willing to accept
Actual price = $20
Minimum price willing to accept = $16
Producer surplus = $20 – $16
Producer surplus = $4.
If you give sales, have really good customer service, have clearance on some items, and if they honor what a worker says to the customer. Also if the workers are respectful
$20,995
Cost of goods sold:
17,500 Beginning inventory
+19,252 Plus purchased inventory
- $15,757 Minus ending inventory
=20,995 Cost of Goods Sold