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sergij07 [2.7K]
3 years ago
15

If the rate of inflation is 5 %​, what nominal interest rate is necessary for you to earn a 2.4 % real interest rate on your​ in

vestment? ​(Note: Be careful not to round any intermediate steps less than six decimal​ places.)
Business
1 answer:
Sedaia [141]3 years ago
8 0

Answer:

7.52%

Explanation:

Use fisher equation to solve this question. It is an equation that shows the relationship between nominal interest rate  and real interest rate in consideration to inflation rate.

Fisher equation;

Nominal = [ (1+ Real rate) *(1+inflation)] -1

Nominal = [(1+0.024) *(1+0.05)] -1

Nominal = (1.024* 1.05 ) -1

Nominal = 1.0752 -1 = 0.0752 or 7.52%

Therefore, the nominal rate is 7.52%

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You plan to invest $600 in your savings account this year and then you intend to increase the amount that you invest by 3% each
koban [17]

Answer:

The correct answer is $20,211.84.

Explanation:

According to the scenario, the given data are as follows:

Payments (PMT) = $600

Interest rate = 7%

Growth rate = 3%

Time = 16 yeras

So, future value of growing annuity can be calculated by using following formula :

FV of growing annuity = Payment × ((1+ interest rate)^n - (1 + Growth rate)^n) / (Interest rate - Growth rate)

= 600 × ((1.07)^16 - 1.03^16) / (.07 - .03)

= 600 × ( 2.95216374857 - 1.6047064391 ) / (0.04)

= 600 × 33.6864

= $20,211.84

Hence, the correct answer is $20,211.84.

7 0
3 years ago
Global Exporters recently announced that it will pay annual dividends of $1.10; $1.25, and $1.30 a share over the next three yea
Paraphin [41]

Answer:

$14.42

Explanation:

Please kindly check attachment for the step by step solution of the given problem.

3 0
3 years ago
Read 2 more answers
Exercise 3-22 Recording costs of labor LO P2 Prepare journal entries to record the following production activities. Incurred $75
Paladinen [302]

Answer:

WIP                            75,000 debit

       Factory Payroll Payable 75,000 credit

Factory Overhead     20,000 debit

       Factory Payroll Payable 20,000 credit

Explanation:

The direct labor is capitalized through work in process inventory to lter become finished good once the product is finished.

While the indirect labor is determinated as actual factory overhead to be later compare against the applied overhead

7 0
2 years ago
What do you think a career is?<br> What is an employer?<br> What is an employee?
NARA [144]

Answer:

down below

Explanation:

A career is a occupation that people take for usually long periods of time, many times people have a career for there whole life, it's something you have progress with over the years.

a employer is either a person or organization that employs people for a job

a employee is someone who is working at a job for means of wages or salary.

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3 years ago
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Lemur [1.5K]

By doing so, the company is contributing to the global tragedy of the commons.

Tragedy of the Commons is an unhappiness resulting from the cruelty of working for something. The tragedy of Shared Ownership arises when every human being tries to take natural resources that are common property for his personal interests to the detriment of other living beings.

The view that causes the Tragedy of Shared Ownership is the desire to gain a lot of profit for personal gain rather than distributing it to other humans and each getting a small share. This view will initially feel beneficial for those who use a lot of natural resources, but in the end the availability of natural resources will run out and actually have a negative impact on those who use them and for other humans. To prevent this, it takes a willingness to sacrifice by getting a little, but it will have a positive impact on the sustainability of the natural resources used.

You can learn more about Tragedy of the Commons here brainly.com/question/9680058

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6 0
7 months ago
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