1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
satela [25.4K]
3 years ago
15

You have saved $5,000 for a down payment on a new car. The largest monthly payment you can afford is $450. The loan will have a

12% APR based on end-of-month payments.
What is the most expensive car you could afford if you finance it for 48 months?What is the most expensive car you could afford if you finance it for 60 months?
Business
1 answer:
Temka [501]3 years ago
4 0

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.

You might be interested in
Columbus Inc. sells a high end hair dryer in a super competitive marketplace. As a result, market research and competitive press
soldier1979 [14.2K]

Answer:

The hair dryer cost cannot exceed 27 dollars per unit

Explanation:

the target cost will the one which achieve the target profit at the selling price of the market.

In this case we are given that selling price is $53 and we want to achieve a 26 dollar gain per unit therefore:

revenue - cost = profit

revneue - profit = cost

53 -26 = cost

cost = 27

3 0
3 years ago
West Corp. issued 13-year bonds 2 years ago at a coupon rate of 9.4 percent. The bonds make semiannual payments. If these bonds
finlep [7]

Answer:

9.68%

Explanation:

yield to maturity (YTM) = {coupon + [(face value - market value) / n]} / [(face value + market value) / 2]

face value = $1,000

market value = $1,000 x 0.98 = $980

n = (13 - 2) x 2 = 22

coupon = $1,000 x 0.094 x 1/2 = $47

YTM = {$47 + [($1,000 - $980) / 22]} / [($1,000 + $980) / 2] = $47.9090 / $990 = 0.4839 x 2 (annual rate) = 0.09678 = 9.68%

4 0
3 years ago
Please help!!! I need help ASAP!
34kurt
Hi!

 The answer to your question should be B. Pays the difference of the current value to the amount you owe.
5 0
3 years ago
Kela Corporation reports net income of $550,000 that includes depreciation expense of $76,000. Also, cash of $53,000 was borrowe
Bogdan [553]

Answer:

$626,000

Explanation:

Kela corporation has a net income of $550,000

Depreciation expense is $76,000

Cash is $53,000

Therefore the total cash inflows from operating activities can be calculated as follows

=$550,000 + $76,000

$626,000

Hence the total cash inflow from operating activities is $626,000

3 0
3 years ago
A cash-basis individual taxpayer owns 55% of Stone, a C-corporation. Stone uses the accrual method of accounting and owes the ta
Strike441 [17]

Answer: $2,250

Explanation:

The Tax-Payer uses a cash-basis. This means that they recognize revenue or expenses only when they are actually paid as opposed to an Accrual basis entity that recognizes revenue or expenses when it is incurred.

As the Cash-Basis taxpayer is the majority shareholder of the company, Stone may not deduct the amount from income until they have paid the tax payer because tax regulations state that when an Accrual Basis entity owes a majority owner who uses the Cash basis, they may not recognize the deduction until they have paid the owner.

In year 2 they paid ½ of the rent which is,

= 4,500/2

= $2,250

They can therefore only deduct $2,250 in Year 2.

7 0
3 years ago
Other questions:
  • In 2018, Maria records self-employed earnings of $135,000. Using the format illustrated in the text, compute Maria's self-employ
    10·1 answer
  • When a commercial for men's razor blades demonstrate how the blades work to create the closest shave, the brand is using a _____
    7·1 answer
  • ) in efficient market, prices appear to move randomly because
    6·1 answer
  • Company AA and Company BB have identical Assets, Revenues and Ebit. They are in the same line of business. Company AA has a Debt
    6·1 answer
  • If the company budgets to need 4000 units to sell for a month, has a beginning inventory of 1000 units and a desired ending inve
    7·1 answer
  • Rizenton-Pharm, a pharmaceutical company, produces a significant amount of chemical waste every day. The company disposes the wa
    9·1 answer
  • Loanstar had 150 units in beginning inventory before starting 950 units and completing 900 units. The beginning work in process
    8·1 answer
  • A foreign company has offered to buy 75 units for a reduced sales price of $320 per unit. The marketing manager says the sale wi
    11·1 answer
  • Assume the following: The standard price per pound is $2.00. The standard quantity of pounds allowed per unit of finished goods
    8·1 answer
  • Another name for back rushing is?
    8·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!