Answer:
Present value (PV) = $57,500
Interest rate (APR) = 5.9%
Number of years = 5 years
Number of installments in a year (m) = 12
Monthly payments (A) = ?
PV = A<u>(1 - (1 + r/m)-nm</u>)
r/m
$57,500 = A<u>(1 - (1 + 0.059/12)</u>-5x12
0.059/12
$57,500 = A<u>(1 - (1 + 0.004916666667)</u>-60
0.004916666667
$57,500 = A<u>(1 - (1.004916666667)</u>-60
0.004916666667
$57,500 = A<u>(1 - 0.745069959)</u>
0.004916666667
$57,500 = A(51.85017778)
<u>$57,500 </u> = A
51.85017778
A = $1,108.96 per month
Explanation:
In this case, we need to apply the formula for present value of an ordinary annuity on the assumption that payment is made on monthly basis. The present value, interest rate (APR), number of years and number of installments in a year were provided in the question with the exception of monthly payment. Thus, the monthly payment becomes the subject of the formula.
Answer:
$18,000
Explanation:
The computation of overall effect on the company's monthly net operating income is shown below:-
Current Proposed
Sales $800,000 $837,000
(200 × 4000) (200 - 14) × (4,000 + 500)
Variable expenses $160,000 $180,000
(40 × 4000) (40 × (4,000 + 500))
Contribution margin $640,000 $657,000
Fixed expenses $531000 $566,000
($531,000 + $35,000)
Net operating
income $109,000 $91,000
Decrease in net operating income = Current - Proposed
= $109,000 - $91,000
= $18,000
So, for computing the overall effect on the company's monthly net operating income we simply applied the above formula.
Answer:
Date Account Titles and Explanation Debit Credit
Cash $27,500
Common stock $27,500
(Being shares issued at cash price recorded)
Common stock = 2,500 shares * $11
Common stock = $27,500
Answer: a. I, II and III are true
Explanation:
From the question, the statements that are true are:
I. 4% is the desired real rate of interest. II. 6% is the approximate nominal rate of interest required.
III. 2% is the expected inflation rate over the period.
4% is the desired real rate of interest because that's the rate at which the investor is willing to buy the goods in future.
2% is the expected inflation rate over the period because at that rate, there's expectation of future rise in price while 6% is the approximate nominal rate of interest required which is the addition of the 4% and the 2%.
Answer:
E decrease the product price
Explanation:
Maturity stage of the product is the stage where the product has already saturated in the market and sales begin to peak and slow down. Many companies will want to maintain this stage when it peaks but when the decline starts showing up it is a great challenge for them due to competition that cuts in from other companies. so companies at maturity stage would want to adopt the method of decreasing the price of the product in order to fight off competition.
