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san4es73 [151]
3 years ago
5

First National Bank charges 13.5 percent compounded monthly on its business loans. First United Bank charges 13.8 percent compou

nded semiannually. Calculate the EAR for First National Bank and First United Bank. (Do not round intermediate calculations and enter your answers as a percent rounded to 2 decimal places, e.g., 32.16.)
Business
1 answer:
Romashka-Z-Leto [24]3 years ago
7 0

Answer: 14.28%

Explanation:

Effective Annual Rate is the rate that takes the periodic rates and converts it to an annual rate if compounding the periodic rate was taken into account.

The formula is;

EAR = (1 + r/m)^m - 1

Where;

r is the Annual nominal rate of interest and,

m is Number of compounding periods in a year

EAR = ( 1 + 13.8/2)² - 1

= 1.142761 - 1

= 0.142761

= 14.28%

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6 0
2 years ago
The three key functions of sensation are, respectively, _____.
Elina [12.6K]
The answer to this question is <span>detection, stimulation, and transmission
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6 0
3 years ago
oas on a callable bond is 75 basis points using on-the-run treasuries as benchmark rates. which is correct?
Rina8888 [55]

The correct statement is option C. OAS reflects the credit risk and liquidity risk of the bond over the treasury benchmark rates. Read below about a callable bond.

<h3>What is a callable bond?</h3>

A callable bond is a type of bond that permits the issuer of the bond to retain the privilege of redeeming the bond at some point before the bond reaches its date of maturity. Consequently, the said point which is basis is 75.

Therefore, the correct answer is option C. OAS reflects the credit risk and liquidity risk of the bond over the treasury benchmark rates.

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4 0
2 years ago
In an​ economy, the​ working-age population is 100 million.
Veronika [31]

Answer:

3.6%

Explanation:

The formula to compute the unemployment rate is shown below:

Unemployment rate = (Number of Unemployed workers) ÷ (Total labor force) × 100

where,  

Number of unemployed workers = 3 million

And, The labor force = 80 million + 3 million = 83 million

Now the unemployment rate is

= (3 million) ÷ (83 million)

= 3.6%

7 0
3 years ago
Gere Furniture forecasts a free cash flow of $40 million in Year 3, i.e., at t = 3, and it expects FCF to grow at a constant rat
LenKa [72]

Answer:

Option (A) is correct

Explanation:

Given that,

Free cash flow in Year 3, FCF3 = $40 million

FCF to grow at a constant rate, g = 5%

Weighted average cost of capital, WACC = 10%

Cost of equity = 15%

Therefore,

Horizon Value at year, t = 3:

=\frac{FCF4}{(WACC-g)}

=\frac{FCF3(1+g)}{(WACC-g)}

=\frac{40(1+0.05)}{(0.10-0.05)}

=\frac{42}{0.05}

     = $ 840

4 0
3 years ago
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