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3 years ago

What is the effective annual rate (EAR)?

2 answers:

7 0

Answer: The effective annual rate (EAR) is the interest rate that would earn the same interest with annual compounding.

The Effective Annual Rate (EAR) is know as the interest rate earned on a subject/asset or remunerated on a borrowing as a consequence of compounding interest over period of time.

The formula to compute effective annual rate is as follow:

$Effective Annual Rate = [1 + \frac{interest rate}{compounding periods}]^{time periods} - 1$

∴ Option (c) is correct.

Furkat [3]3 years ago

6 0

Answer:

The correct option here is C) .

Explanation:

The EAR (effective annual interest rate) which is also know as annual equivalent rate, is the interest rate which is either earned or it is paid on a loan or an investment or any financial product because of the compounding done over a defined period of time. This rate comes in very handy when one has to compare different products like loans or certificate of deposits.

FORMULA -

= ( 1 + i / n )^n - 1

where i = interest rate(NOMINAL ) and n = number of periods

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Suppose that borrowing is restricted so that the zero-beta version of the CAPM holds. The expected return on the market portfoli

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Answer:

10.4%

Explanation:

The computation of expected return on a portfolio is shown below:-

Expected return = Risk Free return + 5%Beta ( Market Return - Risk Free return)

= 5% + 0.60 × (17% - 8%)

= 5% + 5.4%

= 10.4%

Therefore for computing the expected return on a portfolio with a beta of .6 we simply applied the above formula.

The market return less risk free return is known as market risk premium

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3 years ago

The Converting Department of Worley Company had 2,400 units in work in process at the beginning of the period, which were 35% co

irinina [24]

Answer:

Equivalent units

Materials = 12,700 units

Conversion cost = 11,940 units

Explanation:

Equivalent Units E.U) are notional whole units which represent incomplete work and are used to apportion costs between between work in progress and completed work.

Equivalent Units = Degree of completion (%) × units

We will use the weighted average method

Weighted average method

The weighted average method of valuation of work in progress does not separate opening work-in progress from the newly introduced.

Using the weighted average method

Equivalent unit for material cost

Since direct materials are added at the the beginning of the production process the equivalent unit of direct material

EU = (100% × 10,800) + (100% ×1900) = 12700

Note that 100% represent the degree of completion.

Equivalent unit for conversion cost

Item Equivalent unit

Transferred out 100%× 10,800 = 10,800

Closing inventory 60% ×1900 = 1140

Total equivalent unit = 11,940

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3 years ago

In the second half of 2019, automobile sales in the United States were lower than they were in the second half of 2018. The decr

Monica [59]

In the second half of 2019, automobile sales in the United States were lower than they were in the second half of 2018. The decrease in auto sales impacts GDP because new automobiles are counted as consumption when purchased by households and investment when purchased by businesses.

Gross domestic product (GDP) is the overall monetary or market value of all of the goods and services produced within a country's borders in a particular time period.

GDP can be calculated by adding up all of the money spent by consumers, businesses, and the government in a given period. It may also be calculated by adding up all of the money received by all the participants in the economy.

learn more about Gross domestic product (GDP) here

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2 years ago

G according to the neoclassical theory of distribution, the real wage earned by any worker equals that worker's marginal product

alexgriva [62]

A. According to the neoclassical theory, technical progress that increases the marginal product of farmers causes their real wage to rise. B. The real wage in (a) is measured in terms of farm goods. That is, if the nominal wage is in dollars, then the real wage is W/PF, where PF is the dollar price of farm goods. C. If the marginal productivity of barbers is unchanged, the their real wage is unchaged. D. The real wage in (c) is measured in terms of haircuts. That is, if the nominal wage is in dollars, then the real wage is W/PH, where PH is the dollar price of a hair-cut. E. If workers can move freely between being farmers and being barbers, then they must be paid the same wage W in each sector. F. If the nominal wage W is the same in both sectors, but the real wage in terms of farm goods is greater than the real wage in terms of haircuts, then the price of haircuts must have risen relative to the price of farm goods.

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3 years ago

Craig, one of the senior managers at Clayton Inc., insisted that company supervisors handle employee relations as part of their

Alekssandra [29.7K]

Answer:

The supervisors represent the company on a day-to-day basis.

Explanation:

Craig said that the supervisors take employee relations as part of their jobs.

The option that buttresses this is that supervisors represent the company on a day-to-day basis. Meaning the supervisors as owners of the company, and as if they have a stake. Supervisors taking ownership presupposes they perform tasks like handling employee relations to ensure the business and the employee work harmoniously.

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3 years ago

What is the effective annual rate​ (EAR)?

What is the effective annual rate (EAR)?