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
xeze [42]
2 years ago
14

You have two options to repay a loan. You can repay $6,000 now and $5,940 in one year; or you can repay $12,000 in 6 months. Fin

d the annual effective interest rate(s) i at which both options have the same present value.
Business
1 answer:
Brums [2.3K]2 years ago
7 0

Answer:

We will consider positive interest rate which is i=0.21 or i=21%

Explanation:

The formula for Future value is:

FV=PV(1+i)^n

The present value will become:

PV=FV(1+i)^{-n}

where:

n is the number of years

Since the condition is same present value,so the given data form the equation:

6000+5940(1+i)^{-1}=12000(1+i)^{-1/2}

Divide above equation by (1+i)^{-1}

6000(1+i)+5940=12000(1+i)^{1/2}

Let z=(1+i)^{1/2}\\. Above equation will become:

6000z^2+5940=12000z

Rearranging above equation:

5940-12000z+6000z^2=0

Solving the quadratic equation:

z=1.1,    z=0.9

Let z=(1+i)^{1/2}\\ will become:

z=(1+i)^{1/2}\\\\z^2=1+i

i=z^2-1

For z=1.1

i=(1.1)^2-1\\i=0.21

For z=0.9

i=(0.9)^2-1\\i=-0.19

we will consider positive interest rate which is i=0.21 or i=21%

You might be interested in
Which individual can use the head of household filing status?
Lana71 [14]

Answer:

A. A married person with children

Explanation:

That person would be the head because he would be in charge.

8 0
2 years ago
If a country had a CPI of 91.0 last year and a CPI of 90.0 this year, then
Sergio039 [100]

Answer 1: The Correct answer is C) the average prices of goods and services decreased between last year and this year.

CPI stands for consumer Price Index. Also known as the 'basket' the index is developed by national governments to monitor the prices of basic goods and services used by the population.

This has to include basic items that the majority of population uses every day e.g. milk, chicken, electricity etc.

In this case, the CPI had decreased from 91.0 to 90.0 which means the prices fell.

Answer 2: The correct answer is A) 3.6%

The formula to calculate unemployment rate is:

No. of unemployed ÷ No. of Working People x 100

In this case, it was 9 million divided by 250 million x 100

3.6% unemployment rate is actually very less for an economy and is an indicator that the economy is doing well and creating enough jobs for most people. A high unemployment rate signals a worsening economy.

6 0
3 years ago
Hey jgdjrhfddytdswjgbhbjdefrdcd
Arada [10]
Hi sjjajsjahsjshdhahsa
5 0
3 years ago
Select the scenario that best describes the recommended approach for developing team goals.
aleksley [76]

Answer:

d. Michaela and her team create goals that balance the strengths, roles, and responsibilities of individual team members.

Explanation:

Development of team goals is most effective when the set targets are effectively being achieved by the team as a whole.

This entails that each team member contribute their own quota to the process.

The whole team is now involved in execution of planned actions.

The best statement that portrays this is: Michaela and her team create goals that balance the strengths, roles, and responsibilities of individual team members.

5 0
2 years ago
Can I Plss get some help on this
AlladinOne [14]

The law of supply illustrates all the quantities of goods that producers are willing and able to sell at every possible price.

<h3>What is the law of supply?</h3>

The law of supply states that when prices increase, the quantity supplied increases and when price falls, the quantity supplied falls. This shows that price and quantity supplied are positively related. This explains why the supply curve is positively sloped.

To learn more about the law of supply, please check: brainly.com/question/26374465

#SPJ1

7 0
1 year ago
Other questions:
  • According to Wallach, what is short-termism, and why is it a problem?
    5·1 answer
  • You are looking to buy a car and you have been offered a loan with an APR of 5.7 %​, compounded monthly. a. What is the true mon
    7·1 answer
  • Anything that is capable of being owned or controlled to produce value would be considered as what?
    5·1 answer
  • Meger Manufacturing uses the direct labor cost method for applying factory overhead to production. The budgeted direct labor cos
    7·1 answer
  • Background material, fact sheets, news releases, and sample photos are commonly found in what important business communication p
    9·1 answer
  • Lexi Company forecasts unit sales of 1,640,000 in April, 1,250,000 in May, 810,000 in June, and 1,650,000 in July. Beginning inv
    15·1 answer
  • In accordance with 1926.21(b)(2), the employer is required to instruct each employee in the _______________ of unsafe conditions
    14·1 answer
  • Tubby Toys estimates that its new line of rubber ducks will generate sales of $7.20 million, operating costs of $4.20 million, a
    15·1 answer
  • Hester operates a hand car wash service and charges customers $10 per car wash. Based on her knowledge of operations, the 100th
    9·1 answer
  • What is a primary difference between a note receivable and an account receivable?
    9·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!