The maximum commission that Broker Claire can charge for securing a $50,000 first mortgage is $2,500.
Basically, a broker is entitled to a commission as a compensation.
The law governing mortgage loan brokers states that the maximum commissions for loans of a period of 2 years is 5% of the principal of a loan of less than 3 years.
Since the broker secure a $50,000 first mortgage.
Commission = $50,000 * 5%
Commission = $2,500
In conclusion, the maximum commission that Broker Claire can charge for securing a $50,000 first mortgage is $2,500.
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Answer:
A decrease in the interest rate would increase the present value of a lump sum.
Explanation:
Higher interest rate represents higher expected rate of return. Higher interest rate would lead to a greater future value if a sum of money is invested. Conversely the present value will be lower at high interest rate since the discounting rate would be higher.
Similarly, if the interest rates fall, the future value of an invested amount will fall. But present value of a lump sum would rise with fall in the interest rates since the discounting rate would be less.
Future Value =
Present Value =
Hence, a decrease in the interest rate would increase the present value of a lump sum with others variables remaining the same.
In order for a firm to earn economic profits, price must exceed average total cost.
This is A. true.
Answer: 0
Explanation:
Accrual accounting method simply means when revenue or expenses are written down and recorded at the time that the transaction took place and not when payment was gotten.
The revenue that is recognized on the March income statement will be 0. This is because the delivery was in April and none took place in March.
The constant growth model can be used here even if the
dividends are decreasing by a persistent percentage, just make sure to distinguish
the negative development. So, the computation for the price of the stock today
will be:
P= dividend (1 +reduce payout) / (Return–reduce payout)
P= $12.30(1 – 0.05) / [(0.09 – (–0.05)]
P= $11.69 / 0.14
P = $83.46 is the price you will pay for a share today.