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sergeinik [125]
3 years ago
9

Ed needs to take out a loan for $7,000 to purchase a car. His bank has offered him a loan at 10.0% interest, compounded monthly,

for 36 months or 10.5% interest, compounded monthly, for 24 months. Ed’s goal is to save as much money as possible by the time he pays off the loan. Which of the following statements best describes what Ed should be thinking?
a. Since the monthly payment for the 36 month loan is lower, this loan will save more.
b. Since the monthly payment for the 24 month loan is lower, this loan will save more.
c. Since the finance charge for the 36 month loan is lower, this loan will save more.
d. Since the finance charge for the 24 month loan is lower, this loan will save more.
Business
2 answers:
Evgesh-ka [11]3 years ago
8 0
A is the answer i am very good at loans and the answer is A
riadik2000 [5.3K]3 years ago
7 0

Answer:

d. Since the finance charge for the 24 month loan is lower, this loan will save more.

Explanation:

The longer your repayment term of a loan, the more you finance charges you will pay even though the monthly repayment amount will be less each month. You will inevitably be paying more over the 36 month term.

Calculations:

1. $7000 @ 10% interest for 36 months compounded monthly.

= $7000 (1 + i)ⁿ

= $7000 (1 + 0.10)³

= $9317.00 over 3 years whereas:

2. $7000 @ 10.5% interest rate over 24 months compounded monthly:

= $7000 (1 + 0.105)²

= $ 8547.18 over 2 years.

To conclude, you would end up saving $769.82 by paying off your $7000.00 loan in a 24 month period at a higher interest rate than opting for a longer repayment term of 36 months with a lower interest rate.

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Steve Colburn's portable sawmill used 100% for business, was completely destroyed by fire. The sawmill had an adjusted basis of
pashok25 [27]

Answer: $35,000

Explanation:

A casualty loss is simply a loss that an individual or business incurs when a property is damaged, or destroyed due to an unexpected or sudden event like fire, volcanic eruption, flood etc.

Here, Steve's casualty loss will be gotten when we compare both his adjusted basis and the fair market value and then we choose the lesser one. Since $35000 is lesser than $50000, therefore the answer will be $35000.

8 0
3 years ago
A reading researcher does what
Dmitry_Shevchenko [17]

Answer:

They reveal how the author(s) interpreted the findings of their research and presented recommendations or courses of action based on those findings.

Explanation:

7 0
2 years ago
Orange Inc., an orange juice producer with a current debt-to-equity ratio of 2, is considering expanding its operations to produ
postnew [5]

Answer:

8.25%

Explanation:

Orange, Inc. should calculate the MARR (minimum acceptable rate of return) for this project using the following:

Re = 12% (similar to Paste, Inc., so it can be considered the industry's average)

Rd = 6% x (1 - 25%) = 4.5%

MARR = (1/2 x 12%) + (1/2 x 4.5%) = 6% + 2.25% = 8.25%

This calculation is similar to calculating a company's WACC since you must determine the weighted cost of financing the project.

6 0
3 years ago
Interview any adult you know about their job. Ask the person questions related to the job. You should find out whether the perso
Llana [10]

Answer:

My Answer: Why did you choose to work here? How do you feel about the organization here? What are you likes about the company? Why are working in the same organization? Would you recommend the organization for future employees?

Explanation:

Plato's Answer: I interviewed my aunt, who works at Triple J Productions. She has been working there for 20 years. When she started out, the company offered voluntary monthly trainings for employees looking to advance. The company had a family picnic every summer for employees and their families. The company was very honest, cared about its employees, customers, etc. Three years ago, the CEO passed away. His son took over the company. Now, they do not have any company picnics. Training has stopped and the company often outsources jobs to employees who will work for low salaries. She is now quite unhappy at the company, but feels that she has invested too much time in it to go somewhere else. Ten years ago, she would have said it is a great place to work. Today, she feels that the company's common practices are sneaky and underhanded and their main motivation is money.

I hope it helps!

3 0
3 years ago
Marti received 11 NQOs (each option gives Marti the right to purchase 14 shares of stock for $10 per share) at the time Marti st
ch4aika [34]

Answer:

$924

Explanation:

Bargain element per share = Market price at exercise - Exercise price

Bargain element per share = $16 per share - $10 per share

Bargain element per share = $6 per share

Amount of bargain element = Bargain element per share * (Number of options * Number of shares per option)

Amount of bargain element = $6 per share * (11 options * 14 shares per option)

Amount of bargain element = $6 per share * 154 shares

Amount of bargain element = $924

So therefore, the amount of Marti's bargain element is $924

6 0
2 years ago
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