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
lisabon 2012 [21]
3 years ago
8

Friendly’s Quick Loans, Inc., offers you $8.25 today but you must repay $10.45 when you get your paycheck in one week (or else).

What is the effective annual return Friendly’s earns on this lending business? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) Effective annual return 1,386.67 % If you were brave enough to ask, what APR would Friendly’s say you were paying? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) Annual percentage rate
Business
1 answer:
Ivahew [28]3 years ago
3 0

Answer:

1,386.67%

Explanation:

Loan Amount = $8.25

Repayment Amount = $10.45

Hence,

Interest for a week = Repayment Amount - Loan Amount

                                = $10.45 - $8.25

                                = $2.2

Interest percentage for a week:

= \frac{Interest\ for\ a\ week}{Loan\ Amount}\times100

= \frac{2.2}{8.25}\times100

= 26.66% (approx)

Number of weeks in a year = 52

Therefore,

Effective annual return:

=  Interest percentage for a week ×  Number of weeks in a year

= 26.66% × 52

= 1,386.67%

Hence,  effective annual return Friendly’s earns on this lending business is 1,386.67% .

APR you are paying 1,386.67%.  

You might be interested in
Franklin, Inc uses activity-based costing. The company produces X and Y. Information relating to the two products is as follows:
zvonat [6]

Answer:

A. $192,000

Explanation:

The computation of the labor related overhead cost is shown below:

= (Labor related overhead cost) ÷ (Total direct labor hours) × direct labor hours of X

= ($480,000) ÷ (16,000 hours + 24,000 hours) × 16,000 hours

= $192,000

hence, the correct option is A.

7 0
2 years ago
What is the relationship between a non-callable, option-free fixed rate bond's price and its yield?
Sophie [7]

Answer:

The relationship is that the price for these types of bonds is lower as the Yield is fixed and do not change over time.

The price of a Non-callable bond is cheaper than the price of the Callable bond as the Yield for a Non-callable bond is fixed. This suggest that the investor knows exactly what is the interest that is going to receive until the maturity of the bond.  

5 0
3 years ago
The future value and present value equations also help in finding the interest rate and the number of years that correspond to p
bonufazy [111]

Answer:

r = 4% at this rate a principal of 12,800 returns 16,843.93 in seven years

Explanation:

We will calculate the interest rate at which a principal of 12,800 return 16,843.93 in seven years

Principal \: (1+ r)^{time} = Amount

Principal 12,800

time 7 years

rate         ?

Amount 16,843.93

12800 \: (1+ r)^{7} = 16,843.93

(1+r)^{7} = 16,843.93\div12,800\\\\r =\sqrt[7]{16,843.93\div12,800} -1

r = 0.0400

r = 4%

3 0
3 years ago
Helmert Federal, a financial institution, acquires its funds primarily from the deposits of its customers, and then uses these f
Ghella [55]
<h3>Helmert Federal is a savings and loan association </h3>

Explanation:

A Savings and Loan Association (S&L), or thrift service, is a financial institution specialized in taking savings deposits and making mortgages and other loans. A savings and loan company (S&L) has today been one of the main sources of home buyers ' mortgage loans.

In the specified example, Helmert Federal acquires its funds mainly from its customers ' deposits, and then uses those funds to make individuals ' mortgage loans is a form of savings and loan association.

6 0
3 years ago
Several years ago, Joy acquired a passive activity. Until 2018, the activity was profitable. Joy's at-risk amount at the beginni
Galina-37 [17]

Answer:

b. $20,000: $250,000

Explanation:

The computation is shown below:

The passive activity rules at the opening of 2021 would be equivalent to the amount given i.e. $250,000

And, the suspended amount would be

= $100,000 + $80,000 + $90,000 - $250,000

= $270,000 - $250,000

= $20,000

Hence, the correct option is b.

3 0
3 years ago
Other questions:
  • Producer surplus equals a. Value to buyers - Costs of sellers. b. Amount received by sellers - Costs of sellers. c. Value to buy
    5·1 answer
  • Professional skepticism related to detecting possible fraud involves the validation of information through probing questions. cr
    12·1 answer
  • 5. What is the net return on assets for a hotel that generated total revenue of $4,076,000 in 2006 based on total assets of $7,6
    7·1 answer
  • Hunter Sailing Company exchanged an old sailboat for a new one. The old sailboat had a cost of $210,000 and accumulated deprecia
    5·1 answer
  • Quanti Co., a calendar year taxpayer, purchased small tools for $5,000 on December 21, 2016, representing the company's only pur
    14·1 answer
  • For the coming year, River Company estimates fixed costs at $109,000, the unit variable cost at $21, and the unit selling price
    10·1 answer
  • SummerSnowman Industries' last dividend was $1.25. The dividend growth rate is expected to be constant at 15.0% for 3 years, aft
    14·1 answer
  • A company reports the amounts below in its statement of cash flows.
    13·1 answer
  • According to the specifications that a customer gave to a manufacturer, the length of a shoe should not deviate from the correct
    6·1 answer
  • True or false: when using the time value of money features of a financial calculator, you should key in the interest rate as a d
    5·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!