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Llana [10]
3 years ago
5

You can buy an item for $125 on a charge with the promise to pay $125 in 60 days. Suppose you can buy an identical item for $115

cash. If you buy the item for $125, you are in effect paying $10 for the use of $115 for two months. What is the effective annual rate of interest? Enter your answer as a percentage rounded to two decimal places.
Business
1 answer:
Margarita [4]3 years ago
4 0

Answer:

Effective annual interest rate=0.52%

Explanation:

Step 1: Express the formula for calculating interest

The formula for calculating interest can be expressed as;

I=PRT

where;

P=principal amount borrowed

R=annual interest rate as a percentage

T=number of years

Step 2: Determine the value of the variables P, R and T

In our case;

I=$10

P=(125-10)=$115

R=unknown=r

T=2 months=2/12=1/6 years

replacing in the expression;

10=115×r×(2/12)

10=(230/12)r

r=10×12/230=0.5217

0.5217 rounded off to the nearest 2 decimal places is:

r=0.52%

Effective annual interest rate=0.52%

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A decrease in input costs to firms in a market will result in a(n) _________________
shtirl [24]

Answer:

a) decrease in equilibrium price and an increase in equilibrium quantity.

Explanation:

As the input cost decreases for the companies the the supply of the goods increases hence the supply curve shifts rightwards.In the curve at the new equilibrium point the equilibrium price decreases and the equilibrium quantity increases.

Think it like if cost of creating anything is decreased for a company then the company will create more products .So there will be more products in the market.So to clear the products in the market the price will be reduced and the quantity of the product is more than before.

6 0
3 years ago
Accounting has its own vocabulary and basic relationships. Match the accounting terms with the corresponding definition or meani
balandron [24]

Answer and Explanation:

The matching of the accounting term with the definition is shown below:

1. Debit - it comes in the left side i.e. (i)

2. Expense: It decreases the stockholder equity also it contains the debit balance i.e. (d)

3. Net income: It is a statement that shows the expenses and revenue related transactions i.e. (g)

4. Ledger: It is the T-account in which the journal entries are posted i.e. (e)

5. Posting: The data is copied from journal to ledger we called as posting i.e. (f)

6. Normal balance: It is the side of an account in which the account increment is recorded i.e. (b)

7. Payable: It is a liability and it always a credit balance and shown in the balance sheet i.e (h)

8. Journal: In this the transactions are recorded i.e. (c)

9. Receivable: This is an asset and it has always a debit balance i.e. (a)

10. Owner equity: It is amount i.e. to be invested in the business also shows a difference between the total asset and total liabilities i.e. (j)

8 0
3 years ago
Smith Company makes and sells a single product called a Pod. Each Pod requires 1.4 hours of labor at a labor rate of $9.60 per h
Ganezh [65]

Answer:

Total direct labor costs= $295,680

Explanation:

Giving the following information:

Each Pod requires 1.4 hours of labor at a labor rate of $9.60 per hour.

Production= 22,000 Pods.

<u>First, we need to calculate the total direct labor hours required:</u>

Total direct labor hours= 22,000*1.4= 30,800 hours

<u>Now, the total direct labor costs:</u>

Total direct labor costs= 30,800*9.6

Total direct labor costs= $295,680

3 0
3 years ago
On April 1, 2021, the Electronic Superstore borrows $23 million of which $7 million is due in 2022. Show how the company would r
Serggg [28]

Answer:

Long term liabilities is $23,000,000

Explanation:

                 Electronic Superstore

        Balance Sheet (Not Full) at December 31, 2021

Details                                                Amount ($)

Current liabilities                                     NA

Long-term liabilities                         <u>  23,000,000 </u>    

Total liabilities                                   <u> 23,000,000 </u>                  

Note that the $7 million will due in 2022  not in 2021. Therefore, this does not effect on the 2021 balance sheet entries.      

4 0
3 years ago
How are certificates of deposit similar to U.S. bonds? They are not similar because U.S. bonds cannot be sold to citizens, only
pochemuha

Answer:

The correct answer is letter "D": They give a guaranteed rate of return.

Explanation:

Certificates of Deposit (CD) are investment vehicles that individuals can purchase with the condition of not withdrawing the money pooled after an agreed period so they can obtain the returns of the investment with a higher interest rate.

U.S. bonds, Treasury Bonds or T-bonds are investment vehicles issued by the U.S. government that offers repayment to the principal plus interest after maturity which tends to be from 10 to 30 years.

<em>Both CD and T-bonds offer a rate of return after a specific period agreed with the investment issuer. That return is guaranteed compared to other riskier investments like stocks.</em>

5 0
3 years ago
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