COMMON MEASURE OF WHAT SOMETHING IS WORTH OR WHAT SOMETHING COSTS

Problem 5-1 Simple Interest versus Compound Interest [LO1] First City Bank pays 8 percent simple interest on its savings account

Anna71 [15]

Answer:

$14,343.25

Explanation:

The computation is shown below;

For the first bank

The value of investment is

= $68,000 × 8% × 8 + $68,000

= $111,520

For the second bank

= $68,000 × (1 + 0.08)^8

= $125,863.25

So, the difference in these both amount should be

= $125,863.25 - $111,520

= $14,343.25

7 0

2 years ago

Consider the closed (no exports or imports) Latverian economy in which the consumption function is C = 300 + 0.75DI (where DI =

777dan777 [17]

Answer:

0.66

Explanation:

Marginal propensity to consume is the proportion of disposable income that is spent on consumption

Marginal propensity to consume = change in consumption / change in income = C / Y

Gross domestic product (Y) is the sum of all final goods and services produced in an economy within a given period which is usually a year.

In a closed economy, GDP = Consumption + Investment spending + Government Spending

Y = 300 + 0.75(Y - $1,200) + $900 + $1,300

Y = 300 + 0.75Y - $900 + $900 + $1,300

Collect like terms

Y - 0.75Y = $1600

0.25Y = $1600

Y = $6400

Substitute for Y in the consumption function : 300 + 0.75(Y - $1,200)

300 + 0.75($6400 - $1,200)

300 + 0.75($5,200) = $4,200

C = $4200

Marginal propensity to consume = $4,200 / $6400 = 0.66

4 0

3 years ago

What will you be least likely to be responsible of as part of the accounting team of your organization? A. reconciling accounts

riadik2000 [5.3K]

Accounting is <em>a field that is concerned with the processing, measuring, and communicating of financial information of a company.</em> If you worked in an accounting department, you would most definitely have to reconcile accounts, prepare financial statements, monitor accounting activities, and prepare an investment schedule for the organization.

You will not, however, be expected to (D) develop marketing and advertising strategies. This type of task is usually assigned to the marketing department of a company.

5 0

3 years ago

Lego is considering an investment in Disney corporation. The risk free rate is 5% and the Beta for Disney is 1.2. Lego requires

disa [49]

Answer:

17%

Explanation:

This can be calculated using the Capital Asset Pricing Model which is given as under:

Required Return = Rf + Beta factor * (Market Risk Premium)

By putting the values, we have:

Required Return = 5% + 1.2 * 10% = 17%

Disney need to earn 17% return on investment to trigger a Lego investment.

5 0

2 years ago

Read 2 more answers

Which of the following terms refers to the development of individual offerings that appeal to different market segments while re

erma4kov [3.2K]

Answer:

You have not given any options to chose from but seemingly the answer is Line Extension.

This happens when a company introduces additional items in the same product category under the same brand name such as new flavors, forms, colors, added ingredients, package sizes, etc..

Explanation:

7 0

3 years ago