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Igoryamba
2 years ago
14

John's Auto Repair just obtained an interest-only loan of $35,000 with annual payments for 10 years and an interest rate of 8 pe

rcent. What is the amount of the loan payment in Year 8?
Business
1 answer:
Nookie1986 [14]2 years ago
5 0

Answer:

$2,800

Explanation:

An interest only loan represents a type of loan offer where a borrower is only expected to pay the interest either for some of the term of the loan as agreed or for all of the terms of the loan. However, the principal amount that is collected remains constant all through the agreed interest -only period.

Since the loan obtained by John's Auto Repair is Interest Only, it means that the principal of $35,000 remains constant.

Hence, in the 8th year, John is expected to pay only the interest for the period =

0.08 x $35,000

= $2,800

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You were able to purchase two tickets to an upcoming concert for $100 apiece when the concert was first announced three months a
dusya [7]

Answer: $450

Explanation:

Total tickets purchased = 2

The cost of one ticket three months ago = $100

Current price of one ticket = $225

Total cost of two tickets = $225 × 2

                                        = $450

The opportunity cost is the benefit that is foregone by selecting some other alternative. So, here two options are available that either attend the concert or resell the ticket at $450. Therefore, the opportunity cost of attending the concert is $450.

4 0
3 years ago
Avicorp has a $ 12.9 million debt issue​ outstanding, with a 5.9 % coupon rate. The debt has​ semi-annual coupons, the next coup
zloy xaker [14]

Answer:

a)

Pre-tax Cost Of Debt = 7.64%

b)

Tax Rate = 40%    

Post Tax cost of debt = 7.33% * (1 - 40%) = 4.58%  

So Post Tax cost of Debt = 4.58%

Explanation:

Bond Par Value =  12,900,000  

Bond Market Price 93% of face value = 11,997,000  

Years To maturity = 5.00  

Annual Interest 5.9% = 761,100

Formula = [Annual Interest + (Par Value-Market Value) / Years to Maturity] / [(Par value+Market Price*2)/3]

Year To Maturity = [761100 + (12900000 - 11997000) / 5] / (12900000 + 2*11997000) / 3

Year to maturity = 7.33%

8 0
2 years ago
After another year, Biwei’s business is in rapid expansion. He wants to raise $1M new capital. He can finance by taking a loan o
Snezhnost [94]

Answer:The capital cost is $1 million

Explanation: This is one time expenses on production if goods and services , purchase of land and construction. It is the total cost required to bring a business to a commercially operable status.

8 0
2 years ago
A competitive firm has been selling its output for $10 per unit and has been maximizing its profit. Then, the price rises to $14
defon

Answer:

a. marginal revenue is lower than it was previously.

Explanation:

  • According to the Law of Supply states, when the price of a product or service increases, all other factors are equal, the quantity of products or services offered by the suppliers increases, and vice versa.
  • In other words, if a good price goes up, suppliers will try to increase their profits by offering more goods.
  • so  correct option is a. marginal revenue is lower than it was previously.

7 0
2 years ago
How is the value of a product determine
jasenka [17]
<span>The market value of a product is the price point that is generally accepted by seller and buyer




Hope this helps best of luck =]
</span>
3 0
3 years ago
Read 2 more answers
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