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Ilya [14]
3 years ago
8

Future value.   A speculator has purchased land along the southern Oregon coast. He has taken a loan with the​ end-of-year payme

nts of ​$7 comma 000 for 8 years. The loan rate is 5 ​%. At the end of 8 ​years, he believes that he can sell the land for ​$50 comma 000 . If he is correct on the future​ price, did he make a wise​ investment?
Business
1 answer:
NemiM [27]3 years ago
3 0

Answer: Not a wise investment as Cost exceeds Receipts.

Explanation:

As the amount is a constant payment, it is an annuity and as it is in future we are looking for the future value of an annuity:

Future Value of Annuity = Annuity * [ ( 1 + rate ) ^ time period - 1] / rate

= 7,000 * [ ( 1 + 5%)⁸ - 1] / 5%

= $66,843.76

Speculator pays $66,843.76 for loan and sells for $50,000.

The speculator would be paying more for the loan than they will sell the land for so this is not a wise investment.

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A company's Cash account shows an ending balance of $4,600. Reconciling items included a bookkeeper error of $105 (a $525 check
aleksandrvk [35]

Answer:

$5,275

Explanation:

Bank Reconciliation Statement

Balance as per Cash Book              $4,600

Add check error                                   $105

Add unpresented checks                    $830

Less Lodgments not yet credited     ($260)

Balance as per Bank Statement      $5,275

therefore,

The adjusted Cash book balance is $5,275

6 0
3 years ago
It is believed that ______________ weaken the chemical bonds that constituent mineral grains, enabling them to act in more of a
Ghella [55]
When it comes to the deformation of rocks, it is believed that water weaken the chemical bonds that constituent mineral grains. Water forms a film around the mineral and weaken the bonds. This is why wet rocks tend to act in a more ductile manner. If a rock is dry, they tend to be more brittle.
7 0
3 years ago
Read 2 more answers
Career Cluster
Troyanec [42]

Answer: A

Explanation

4 0
3 years ago
Xavier and alex plan on retiring 27 years from today. at that time, they plan to have saved the same amount. javier is depositin
hammer [34]

The amount by which Alex's deposit amount vary from Javier's if Alex also makes a deposit today, but earns an annual interest rate of 6.2 percent is $3381.39.

<h3>How to calculate the value?</h3>

We use the formula:

A=P(1+r/100)^n

where

  • A=future value
  • P=present value
  • r=rate of interest
  • n=time period.

Hence future value Javier will be:

=$15000*(1.052)^27

=$58,954.40

For Alex:

58,954.40=P*(1.062)^27

P=58,954.40/(1.062)^27

=$11618.61

Hence difference will be:

=15000 - 11618.61

= $3381.39

Learn more about interest on:

brainly.com/question/2294792

#SPJ1

3 0
2 years ago
Sherman, Inc. manufactures chainsaws that sell for $65. Each chainsaw uses $14 in direct materials and $9 in direct labor per un
anzhelika [568]

Answer: $18

Explanation:

Based on the information,

Sales revenue = $65 × 225 = $14625

Cost of goods sold = (45 × $20) + (1125 × $4) + (225 × $14) + (225 × $9)

= $900 + $4500 + $3150 + $2025

= $10575

Gross profit = Sales revenue - Cost

= $14625 - $10575

= $4050

The gross profit for one chainsaw will be:

= $4050/225

= $18

6 0
3 years ago
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