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maxonik [38]
3 years ago
11

Suppose Joe purchases the factory using $200,000 of his own money and $200,000 borrowed from a bank at an interest rate of 6 per

cent. What is Joe’s annual opportunity cost of purchasing the factory?
Business
1 answer:
ratelena [41]3 years ago
5 0

Answer:

$18,000

Explanation:

The opportunity cost refers to the extra costs or benefits lost from choosing one activity or investment over another.

In this case, Joe's opportunity cost = interest earned by his savings account + interest paid to the bank = ($200,000 x 3%) + ($200,000 x 6%) = $6,000 + $12,000 = $18,000

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The $1,000 face value ABC bond has a coupon rate of 10%, with interest paid annually, and matures in 3 years. If the bond is pri
dybincka [34]

Answer:

Bond Price  = $951.9633746 rounded off to $951.96

Explanation:

To calculate the quote/price of the bond today, which is the present value of the bond, we will use the formula for the price of the bond. As the bond is an annual bond, we will use the annual coupon payment,  annual number of periods and annual YTM. The formula to calculate the price of the bonds today is attached.  

Coupon Payment (C) = 1000 * 10% = $100

Total periods remaining (n) = 3

r or YTM = 12%  

 Bond Price = 100 * [( 1 - (1+0.12)^-3) / 0.12]  + 1000 / (1+0.12)^3

Bond Price  = $951.9633746 rounded off to $951.96

7 0
3 years ago
How does demand-pull inflation differ from cost-push inflation?
kicyunya [14]
<span>Demand-pull inflation is asserted to arise when aggregate demand in an economy outpaces aggregate supply. It involves inflation rising as real gross domestic product rises and unemployment falls, as the economy moves along the Phillips curve. This is commonly described as "too much money chasing too few goods".</span>
4 0
3 years ago
Read 2 more answers
In February 2018, Brilliant Industries purchased the Topaz Mine at a cost of $10,000,000. The mine is estimated to contain 500,0
morpeh [17]

Answer:

B. Depletion will be $950,000 during  2018

Explanation:

Cost           $10,000,000

Residual Value ($500,000)

Cost to be depleted $9,500,000

No. of Carats to be extracted over the life of mine 500,000

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Depletion for the year 2018     $19*50,000=$950,000

This will be deducted from revenue as depletion for the year.So option B is correct.

8 0
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Revenues are recognized when ______, even when the cash is collected in a different accounting period than the obligation to the
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The condition for which revenues are recognized even when the cash is collected in a different accounting period is;

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<h3>Revenue recognition</h3>

Two major forms of revenue recognition exist;

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  • When services are provided even if cash has not yet been collected. This is the case when the organisation used accrual basis accounting

Read more on revenue recognition;

brainly.com/question/26274038

6 0
2 years ago
Assume oil prices rise in the United States, generating concerns that inflation may increase. If the Fed wishes to ensure that i
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If the Fed wishes to ensure that inflation does not get out of hand, the Fed could lower the <em>target money supply growth rate</em>.

Inflation is when the general price levels in an economy increases persistently overtime.  The policy tools that the Fed can use to control general price levels in the economy is known as monetary policy.

There are two types of monetary policy :

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To learn more about monetary policy, please check: brainly.com/question/15566475?referrer=searchResults

7 0
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