Answer: PMI will automatically be dropped when the balance reaches $117,000.
Explanation: PMI stands for private mortgage insurance. This is an insurance policy that banks often require lenders to have when they do not have a 20% down payment on a new home.
PMI is automatically dropped with the amount of the mortgage due is reduced to 78% of the original appraised value of the home. In this case, the home was originally purchased for $150,000. 78% x 150,000 = $117,000. When the loan reaches $117,000 the pmi will automatically be dropped.
The definition above is that of MOTELS. Motels are hotels which are typically designed for motorists and which usually have parking lots for vehicles. They are designed in such a way that the rooms open directly to the parking area. Motels became popular around 1920s when highway system allowed people to engage in long distance travelling by roads.
Answer: increase by $80 million, and the maximum money-lending potential of the commercial banking system will increase by $400 million
Explanation:
Based on the information given in the question, the money multiplier will be calculated thus:
Money multiplier = 1/Required reserve ratio
where,
Required reserve ratio = 20%
Money Multiplier will now be:
= 1/0.20
= 5
Therefore, the maximum money-lending potential will be:
= $80 million × 5
= $400 million
Therefore, the money supply will by $80 million, and the maximum money-lending potential of the commercial banking system will increase by $400 million
Answer:
The company paid $278,031
Explanation:
Giving the following information:
A company bought a parcel of land twenty years ago. The land is currently worth $575,000. The yearly appreciation rate has been 3.7%.
<u>To calculate the past value of the land, we need to use the following formula:</u>
PV= FV/(1+i)^n
PV= present value (20 years ago)
n= 20
FV= 575,000
i= 0.037
PV= 575,000 / (1.037^20)
PV= $278,031
Answer:A. Cost is greater than net realisable value(NRV)
Explanation:
An inventory should not be higher than the price its sale or use and this requires the comparison of inventory cost to it's ( NRV) and whichever is lower will be used as cost of inventory
NRV= Sales price less cost to completion and less estimated cost necessary to make the sales.
