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balandron [24]
3 years ago
7

A home buyer can afford to spend no more than $1500/month on mortgage payments. Suppose that the interest rate is 6%, that inter

est is compounded continuously, and that payments are also made continuously. (a) Determine the maximum amount that this buyer can afford to borrow on a 20-year mortgage; on a 30-year mortgage. (b) Determine the total interest paid during the term of the mortgage in each of the cases in part (a). 2Evangelista Torricelli (1608–1647), successor to Galileo as court
Business
1 answer:
krok68 [10]3 years ago
8 0

Answer:

20 years mortgage:

maximum loan  $ 209, 371.16

interest paid     $  150,628.84

30 years mortage

maximum loan  $ 250,187.4216

interest paid     $  289,812.58

Explanation:

20 years mortgage:

C \times \frac{1-(1+r)^{-time} }{rate} = PV\\

C 1,500.00

time 240 (20 years x 12 months)

rate 0.005 ( 6% annual / 12 months per year)

1500 \times \frac{1-(1+0.005)^{-240} }{0.005} = PV\\

PV $209,371.1575

Quota x number of cuotas - principal = total interest

1,500 x 240 - 209,371.16 = 150628.84

30 years mortgage

C \times \frac{1-(1+r)^{-time} }{rate} = PV\\

C 1,500.00

time 360

rate 0.005

1500 \times \frac{1-(1+0.005)^{-360} }{0.005} = PV\\

PV $250,187.4216

Quota x number of cuotas - principal = total interest

1,500 x 360 - 250,187.42 = 289,812.58

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NemiM [27]

Answer:

The correct answer is option d.

Explanation:

The most effective model to understand the effect of change of a variable on other variable is by assuming other factors to be constant. This simplifies the model and helps in easily understanding the relationship between the two variables.  

Though the assumption of other things being constant does not apply in the real world, it is still used as otherwise change in other factors would complicate the model. If several factors change it would be difficult to understand the relationship between variables.  

Here, to study the effect of change in the price of grapes on the market for wine, it is necessary to assume other factors such as income, consumer preferences, etc to be constant.

4 0
3 years ago
Cason is filing as single and has 2019 taxable income of $36,000 which includes $34,000 0%/ 15 % / 20% net long-term MID capital
AleksandrR [38]

Answer:

The correct answer of this question is b-200$.

Explanation:

As per tax schedule if income from capital gain is less than 39,375$ 0% tax is charge lieved.

So on his income from capital gain that is 34,000 dollars no tax will be charge. However the remaining income is subject to income tax that is (36000-34000)= 2000 dollars. So Cason is liable to pay tax equals to 200$. (2000*10%)

As per tax law whose income is less than 9,750 dolars is liable to pay tax at the rate of 10%.

5 0
2 years ago
The list price on Boyton's catalog indicated that product A sells for $3,000, with a trade discount of 5%. Boyton sells the good
Alexeev081 [22]

Answer:

B) $2,850

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1: Find the discount: $3,000*5% = $150

2: Subtract the discount: $3,000 - $150 = $2,850

4 0
3 years ago
LO 7.3Which is not a section of the cash budget?
Bad White [126]

Answer:

allowance for uncollectible accounts

Explanation:

The cash budget represents the cash inflow and cash outflow position with respect of cash receipts and cash payments i.e cash disbursement plus it also involves financing needs i.e how much amount is to be borrowed

But it does not involve the allowance for uncollectible accounts  as it is not shown in the cash budget because it is shown under the debtors side with the negative amount of the balance sheet

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Assets

Current Assets

Account receivable                                             XXXXX

Less: Allowance for uncollectible accounts       XXXXX  

Net account receivable                                      XXXXX

8 0
3 years ago
A preferred stock sells for $54.20 a share and has a market return of 9.68 percent. What is the dividend amount
kolbaska11 [484]

Answer:

$5.25

Explanation:

A preferred stock is sold at $54.20

The market return is 9.68%

Therefore the dividend amount can be calculated as follows

= 54.20 × 9.68/100

= 54.20 × 0.0968

= $5.25

Hence the dividend amount is $5.25

6 0
2 years ago
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