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aalyn [17]
3 years ago
10

American Express and other credit card issuers must by law print the Annual Percentage Rate (APR) on their monthly statements. I

f the APR is stated to be 18.00%, with interest paid monthly, what is the card's EFF%
Business
1 answer:
In-s [12.5K]3 years ago
5 0

Answer: 19.56%

Explanation:

Effective Rate of Return is the rate that takes into account, the compounding influence of interest rates in a given period.

It is calculated with the formula,

= ( 1 + r/n) ^ n - 1

Where

r = APR

n = no of compounding periods in a year

Interest is paid monthly so nnumber of periods will be 12.

Therefore,

EFF = ( 1 + 18%/12)¹² - 1

EFF = 19.56%

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When you are in a conflict with another person, it is important to remember:
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3 years ago
You are 20 years old and have completed your BBA and want to pursue further education but you don’t want to take money from your
Dmitrij [34]

Answer:

1. Will you be able to meet your goal at this current saving rate?

  • yes, you will even have some spare money

annual cost of MBA = 400,000 x 2 years = 800,000

monthly salary = 25,000 and you will deposit 12,500

ordinary annuity, 0.8333%, 59 periods (5 years - 1 month) = 75.80535

the future value of your account = 12,500 x 75.80535 = 947,566.88 which is more than the cost of the MBA

2. What percentage of your salary should you save if you want to have exactly your university expenses amount?

  • 42.2138%

800,000 / 75.80535 = 10,553.34

10,553.34 / 25,000 = 0.422138 = 42.2138%

3. How would your answer to part 1 change if the saving account rate changed to 5%?

  • actually you still have more money than what you need even if the interest rate falls to 5%, so you can still take your MBA

monthly salary = 25,000 and you will deposit 12,500

ordinary annuity, 0.41666%, 59 periods (5 years - 1 month) = 66.72805

the future value of your account = 12,500 x 66.72805 = 834,100.63 which is more than the cost of the MBA

4. If you are given an option to invest at the 10% saving rate with monthly compounding or 10.5% semiannual compounding, which would you chose?

  • I would choose the 10.5% semiannual compounding because the effective interest rate is higher.

the effective interest rate of investing at 10% compounded monthly = (1 + 10%/12)¹² - 1 = 10.47%

the effective interest rate of investing at 10.5% compounded semiannually = (1 + 10.5%/2)² - 1 = 10.77%

8 0
3 years ago
If you make a false statement or commit a forgery about your motor vehicle insurance you can be guilty of a ________ degree misd
Vinil7 [7]
<span>If you make a false statement or commit a forgery about your motor vehicle insurance you can be guilty of a  Second Degree Misdemeanor
From the different classes of misdemeanor, a second degree misdemeanor is considered less serious compared to the first degree. The punishment for second-degree misdemeanor will be no more than 2 years</span>
6 0
3 years ago
Read 2 more answers
It is July 16. A company has a portfolio of stocks worth $100 million. The beta of the portfolio is 1.2. The company would like
Anuta_ua [19.1K]

Answer:

A. The company should take Short position and

140 contract

B. The company should take Long position and 60 contract

B.

Explanation:

Calculation for what position that the company should take

Using this formula

Company position=(Beta of the portfolio*Change in beta of the portfolio) *Portfolio of stocks /Index futures price* Each Contract index times

Let plug in the formula

Company position =(1.2-0.5)*$100 million/2,000*250

Company position=0.7*$100 million/500,000

Company position=$70,000,000/500,000

Company position=140 contract

Therefore the position that the company should take will be SHORT position with 140 contract

B. Calculation for the increase in beta of the portfolio from 1.2 to 1.5 and what position tthr company should take in the futures contract and how many contracts

Using this formula

Company position=Increase in beta of the portfolio *Portfolio of stocks /Index futures price* Each Contract index times

Let plug in the formula

Company position =(1.5-1.2)*$100 million/2,000*250

Company position=0.3*$100 million/500,000

Company position=$30,000,000/500,000

Company position=60 contract

Therefore the company should take Long position and 60 contract

4 0
3 years ago
Which of the following is not a way to improve your credit?
inessss [21]

The way where the credit is not improved is that if we moving the debt around.

Information related to the credit score & creditworthiness:

  • The credit score is the mathematical expression that depends upon your creditworthiness.
  • Creditworthiness is the willingness of the lender for believing you to pay off the debts.

The credit should be improved by:

  • Having established accounts.
  • Bills are paid on time
  • Less balances.

But if the debt is moving around so this does not improve your credit.

Therefore we can conclude that the way where the credit is not improved is that if we moving the debt around.

Learn more about creditworthiness here: brainly.com/question/2254218

3 0
3 years ago
Read 2 more answers
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