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Maslowich
3 years ago
14

You just borrowed money for four years to buy a car. The payments are $218 a month and the APR is 7 percent. How is the EAR comp

uted?
Business
1 answer:
Serggg [28]3 years ago
5 0

Answer:

EAR= 0.072 = 7.2%

Explanation:

Giving the following information:

Nominal interest rate= 7%

Number of periods= 12 months

<u>To calculate the Effective Annual Rate (EAR), we need to use the following formula:</u>

EAR= (1 + nominal rate/number of periods)^number of periods

EAR= [(1 + 0.07/12)^12] - 1

EAR= 0.072 = 7.2%

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A depreciable asset has an estimated 15 percent salvage value. At the end of its estimated useful life, the accumulated deprecia
8090 [49]

Answer:

B

Explanation:

Depreciation is the uniform decrease in the value of an asset over a period until the salvage value is reached.

It is given by :

Annual depreciation expense = (cost of asset - salvage)÷ useful life of the asset

Therefore the accumulated depreciation would not equal the original cost of the asset at the end of its estimated useful life because the salvage value will be deducted from cost of asset under declining-Balance.

7 0
3 years ago
Margaery is in search of a new job. She is of the opinion that the first step in making a good match between what she has to off
Basile [38]

Option B  need for altruism

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3 years ago
You purchased 1,350 shares of Barrett Golf Corp. stock at a price of $36.23 per share. While you owned the stock, you received d
enot [183]

Answer:

$6210.00

Explanation:

The computation of total dollar return on the investment is shown below:-

Total Return on Shares = (Dividend + (Sale price - Purchase price)) × Number of Shares

=  ($0.65 + $40.18 - $36.23) × 1,350

= $4.6 × 1,350

= $6210.00

Therefore for computing the total return on shares we simply applied the above formula.

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3 years ago
Which of the following is not true of credit card
grandymaker [24]
. they are the best payment
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3 years ago
Read 2 more answers
Stech Co. is issuing $9 million 12% bonds in a private placement on July 1, 2017. Each $1,000 bond pays interest semi-annually o
STALIN [3.7K]

Answer:

Expected selling price =$ 1,271.81

Explanation:

<em>The price of a bond is the present value (PV) of the future cash inflows expected from the bond discounted using the yield to maturity.</em>

<em>These cash flows include interest payment and redemption value</em>

The price of the bond can be calculated as follows:

Step 1

<em>PV of interest payment</em>

coupon rate - 12%, yield - 8%, years to maturity- 10 years

Semi-annual coupon rate = 12%/2 = 6%

Semi-annual Interest payment =( 6%×$1000)= $60

Semi annual yield = 8%/2 = 4%

PV of interest payment

= A ×(1- (1+r)^(-n))/r

A- interest payment, r- yield - 4%, n- no of periods- 2 × 10 = 20periods

= 60× (1-(1.04)^(-10×2))/0.04)

= 60× 13.59032634

=$815.41

Step 2

<em>PV of redemption value (RV)</em>

PV = RV × (1+r)^(-n)

RV - redemption value- $1000, n- 2×10 r- 4%

= 1,000 × (1+0.04)^(-2×10)

= $456.38

Step 3

<em>Price of bond = PV of interest payment + PV of RV</em>

= $815.41 + $456.38

= $ 1,271.81

Expected selling price =$ 1,271.81

5 0
3 years ago
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