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kari74 [83]
3 years ago
12

A store will give you a 2% discount on the cost of your purchase if you pay cash today. Otherwise, you will be billed the full p

rice with payment due in 1 month. What is the implicit borrowing rate (EAR) being paid by customers who choose to defer payment for the month? Show your calcuation steps. If you use the financial calculator, tell me your inputs and output (i.e. pv,fv,n, i/Y, pmt).
Business
1 answer:
guapka [62]3 years ago
3 0

Answer:

The implicit borrowing rate (EAR) being paid by customers who choose to defer payment for the month is 24.48%

Explanation:

In order to calculate the implicit borrowing rate we would have to calculate the following formula:

implicit borrowing rate=Discount%/(1-Discount%) *12/( payment months - discount month)

According to the given data we have the following:

Discount % =2

Payment days = 1 month

Therefore, implicit borrowing rate=2%/(1-2%)*12/1

implicit borrowing rate=(0.02/0.98)*12

implicit borrowing rate=24.48%

The implicit borrowing rate (EAR) being paid by customers who choose to defer payment for the month is 24.48%

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Your company, Beta Corporation, is considering a new project which you must analyze. Based on the following data, what is the pr
Likurg_2 [28]

Answer:

Net operating cash flow= $9,300

Explanation:

Giving the following information:

Sales $22,000

Depreciation $8,000

Other operating costs $12,000

Tax rate 35%

We need to determine the net operating cash flow:

Sales= 22,000

Other operating costs= (12,000)

Depreciation= (8,000)

EBIT= 2,000

Tax= (2,000*0.35)=  (700)

Depreciation= 8,000

Net operating cash flow= 9,300

4 0
3 years ago
If the average propensity to consume is 0.75, and the marginal propensity to consume is 0.70, if income rises by $4,000, consump
LUCKY_DIMON [66]

Answer:

$2,800

Explanation:

The computation of the increase in consumption is shown below:

= Marginal propensity to consume × rise in income

= 0.70 × $4,000

= $2,800

Hence, the consumption would be increased by $2,800

We simply applied the above formula i.e. marginal propensity to consume is multiplied with the rise in income so that the correct answer could come

7 0
3 years ago
One appraisal principle of value is based on the concept that the more a property or its components are in harmony with the surr
mario62 [17]

Answer:

Conformity

Explanation:

Conformity is an appraisal principle which states that the accurate value of a property tends to be created and then prolonged in a situation where the various features of the property meets up with the different demands of the market.

The basic principle of conformity describes how a particular property is suitable to be located in its surrounding. This is the main reason why different houses are built in the same pattern as the other houses situated in the area. This therefore increases the value of the property.

7 0
3 years ago
Barney wants to start a new business that yields a profit of​ 20% per year after a period of 2 years. In this​ period, if he
crimeas [40]

Answer:

Opportunity costs.

Explanation:

Investing in stocks depicts Barney's opportunity cost of money.

The opportunity cost is the money or funds held up by an individual instead of investing it in other businesses or ventures to yield interests.

5 0
3 years ago
what is the quistan to nunber four pleas help me i realy need your help if you cant help me thats fine but can you try to help m
DochEvi [55]
Yeah there is not question or upload up there

8 0
3 years ago
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