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
Jlenok [28]
3 years ago
13

Saul and Pepper have been friends since kindergarten. Both Saul and Pepper have good part-time jobs. Pepper deposits a portion o

f the money she earns in the bank each week. Saul, on the other hand, spends most of the money he earns on building his baseball card collection.
Recently, a rare 1975 Topps Mini George Brett rookie card has recently gone on sale for $100. This card would greatly enhance the value of Saul’s current collection. However, he does not have money to buy the card. He asks Pepper to loan him $100. He also agrees to sign an IOU to pay Pepper back her $100 plus 7% interest in one month; the time it will take him to have enough to pay her back.
Saul and Pepper’s friend, John, works at a supermarket. He has recently become good friends with Jackson, who works at the same supermarket. John likes Jackson because he is reliable and willing to cover work shifts for him. One day, Jackson asks John to loan him $100. He promises to pay John back in three months with 7% interest. He signs an IOU agreeing to this.
Required:
1. Which IOU pays the most money? Saul’s or Jackson’s? Why?
2. Which IOU seems less risky? Why?
3. Do you think Pepper should lend Saul the money? Should John lend money to Jackson? Why?
Business
1 answer:
ella [17]3 years ago
8 0

Answer:

1.  Both IOUs pay out the same amount of money ($107)

2. Saul’s loan from Pepper is less risky

3. Yes, Pepper should lend Saul the money. Yes, John should lend Jackson the money

Explanation:

1. Let calculate the amount of money to be paid on each IOU:

At the end of one month, Saul's IOU = $ (100 + 100 * 0.07) = $<u>107</u>

<u>Saul pays back $107 to Pepper at the end of one month</u>

At the end of three months, Jackson's IOU = $ (100 + 100 * 0.07) = $<u>107</u>

<u>Jackson pays back $107 to John at the end of three months</u>

<u />

Hence, both Saul and Jackson pay the same amount on their IOUs

Whilst both IOU of Saul and Jackson pay out the same amount, they do so under different time durations. Saul’s IOU to Pepper pays out the amount of money in a shorter duration of time (one month) as compared to that of Jackson which takes three months.

2. Saul's loan from Pepper is less risky. This is because Saul and Pepper have been friends for a verl long time (since kindergarten); that's ample time to have known one another. There is little to no surprise to be displayed between them as they pretty much know all there is to know about one another. This stands in contrast with Jackson with whom John recently became friends; although he has a reputation of being reliable but there is still a greater decree of uncertainty about him since its a new friendship. For example, Jackson could default on his IOU agreement.

On the other hand, while Saul's loan from Pepper is to be payed back in one month, Jackson's loan from John is to be returned over a time span of three months. This gives Jackson more time to spread out repayment much more conveniently than Saul but then again, that's what Saul spends most of his income on.

Saul is taking the loan to advance his investment in his baseball collection which could yield more income for Saul

<u>Hence, overall, Saul's IOU seems less risky</u>

3. Yes, Pepper should lend Saul the money. Asides the fact that they have been friends for over a decade (at the least), Saul already spends his income on building his baseball card collection anyway. It's a win-win for both party; Saul gets the satisfaction of adding an extra valuable card to his collection while Pepper gets the satisfaction of getting an extra $7 from her loan to Saul which she can add to her savings.

Yes, John should John lend the money to Jackson. Jackson already has a strong work and office etiquette which is evident by his reliability. Furthermore, if all goes as agreed, John and Jackson's new friendship could be further deepened and strengthened.

You might be interested in
Hamilton company’s 8 percent coupon rate, quarterly payment, $1,000 par value bond, which matures in 20 years, currently sells a
aliya0001 [1]
The correct answer is the firm's component cost of debt for purposes of calculating the wacc is  7.32%. 
4 0
3 years ago
"Kim wants to run for the U.S. Senate. Kim experimented with drugs in the 1960s, but has not used any drugs in more than 45 year
marishachu [46]

Answer:

The communication behaviour that kim is engaged in is selective self-disclosure.

Explanation:

Self-disclosure is a process of communication by which one person reveals information about themselves to another. The information can be descriptive or evaluative, and can include thoughts, feelings, aspirations, goals, failures, successes, fears, and dreams, as well as one's likes, dislikes, and favorites.

Selective self-disclosure means self-disclosure but providing only that information which will create a positive image of one person on another.

6 0
3 years ago
To what degree a country's legal system is based on the rule of law matters little in international business.
marissa [1.9K]

Rule of law is very important in case of country’s legal system

This means that no one can be regarded to be above the law in a society where the rule of law exists. In a parliamentary democracy, the rule of law places a duty on all citizens to uphold the law, and in order to do so, the legislation must be just and not arbitrary. The goal of the rule of law, like other constitutional concepts, is to advance peoples' freedom and basic rights.

People and corporations must abide by the regulations set forth by the rule of law in order to avoid penalties. The rule of law establishes norms for businesses so that they, too, know what is required of them in their transactions and enables people to comprehend what is expected of them in their personal capacities.

Learn more about rule of law at

brainly.com/question/820417

#SPJ4

3 0
1 year ago
Defragmenting the hard drive identifies areas on the hard drive that need to be fixed
marishachu [46]

Answer:

Defragmenting the hard drive identifies areas on the hard drive that need to be fixed? <u>The answer is FALSE</u>.

Explanation:

When certain information are being removed from the hard drive, tiny gaps are usually being created which can be filled when we store new data. As the new data is being saved on our computer, they occupy those available spaces. When the gaps are not large enough for the files, they get stored in other available areas. This makes the entire files to be scattered and the process is called fragmentation.  

In defragmentation, the system is being asked to put all these scattered information in one area of the file, so that it could be easier for one to access them faster. It does not identify areas on the hard drive that needs to be fixed.  

Check Disk (chkdsk.exe), rather helps with scanning through the entire hard drive, to find and fix errors.  

7 0
3 years ago
Cassandra's Boutique has 2,100 shares outstanding at a market price per share of $26. Sally's has 3,000 shares outstanding at a
Schach [20]

Answer:

E. $60,500

Explanation:

The value of Cassandra's Boutique to Sally's = Cash paid for the acquisition + Incremental cost = $58,000 + $2,500 =  $60,500

Therefore, the value of Cassandra's Boutique to Sally's is $60,500.

7 0
3 years ago
Other questions:
  • Through band-aid's continuous commitment to quality and constant product innovations, band-aid has been able to increase the con
    9·1 answer
  • If the marginal propensity to save (MPS) is 0.25, investment spending (I) is $600 million, and the government increases its purc
    13·1 answer
  • The market value of the equity of Hudgins, Inc., is $594,000. The balance sheet shows $33,000 in cash and $204,000 in debt, whil
    12·1 answer
  • Alfred Zeien, former chairman of Gillette, once noted that his company's Parker Pen unit does not have to develop a special mode
    11·1 answer
  • Hazel transferred the following assets to Starling Corporation: Adjusted Basis Fair Market Value Cash $120,000 $120,000 Machiner
    7·1 answer
  • "Which kind of marketing involves sending an offer, announcement, reminder, or other item to a person at a particular postal add
    10·1 answer
  • Spafford Services, Inc. provides services to clients. On May 1, a client prepaid Spafford Services $71,000 for 6-months services
    12·1 answer
  • Which of the following is true of packaging and labeling?a) An advantage of packaging is the low cost required for the process.b
    10·1 answer
  • Prime Inc. has come up with a new product development project for which the project manager forms a team. The team includes Cam,
    9·1 answer
  • 9. Lobbying for or against trade restrictions Trade restrictions affect the overall welfare of an economy because they change th
    9·2 answers
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!