You plan to borrow $ 4 comma 000 from a bank. In exchange for $ 4 comma 000 today, you promise to pay $ 4 comma 160 in one year

Question

3 years ago

5

. What does the cash flow timeline look like from your perspective? What does it look like from the bank's perspective?

1 answer:

just olya [345] · Answer 1 · 2022-10-20T12:57:36+03:00

Answer:

Please check the attached image for the diagram

Explanation:

I would be borrowing $4000 from the bank. I would be $4,000 richer and the bank would have $4000 less.

In one year, I would be paying the bank $4160. So I would have $4160 less and the bank would be $4160 richer.

A negative sign indicates cash outflow and a positive sign indicates a cash inflow.

I hope my answer helps you.

You plan to borrow $ 4 comma 000 from a bank. In exchange for $ 4 comma 000 ​today, you promise to pay $ 4 comma 160 in one year