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Alexeev081 [22]
3 years ago
13

The future value and present value equations also help in finding the interest rate and the number of years that correspond to p

resent and future value calculations. If a security currently worth $12,800 will be worth $16,843.93 seven years in the future, what is the implied interest rate the investor will earn on the security—assuming that no additional deposits or withdrawals are made? 4.00% 0.19% 3.20% 7.60%
Business
1 answer:
vichka [17]3 years ago
4 0

Answer:

i=4%

Explanation:

this problem is possible to solve applying the principle of future value, keep in mind the next formula:

FV=PV*(1+i)^{n}

where FV is future value, PV is the present value, i is the periodic interest rate and n is the number of periods. So applying to this particular problem we have:

16,843.93=12,800*(1+i)^{7}

the difference here is that we must solve n so we can do:

(\frac{16,843.93}{12,800})^{1/7}-1=i

so i=4%

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3 years ago
A company's product sells at $12 per unit and has a $5 per unit variable cost. The company's total fixed costs are $98,000. The
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Answer:

14,000 units

Explanation:

By the use of the cost volume analysis concept, the break-even point is obtained by dividing fixed costs by contribution margin per unit.

in this case,

fixed costs are $98,000

contribution margin per unit??

CM per unit = selling cost per unit - variable cost per unit

=$12- $5

contribution margin = $7 per unit

break-even point= $98,000/ $7

break -even = 14,000 units

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Read 2 more answers
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