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Anastasy [175]
3 years ago
10

Rock bottom purchases its inventory on trade credit with terms of 2/10 net 45. If the firm waits the full 45 days to pay for the

inventory, what is the effective annual rate of interest is the firm paying for its trade credit
Business
1 answer:
Lera25 [3.4K]3 years ago
8 0

Answer:

The effective annual rate of interest is 23.45%

Explanation:

Effective annual rate of interest=(1+annual interest)^365/t-1

Annual interest =discount rate/100%-discount rate

discount rate here is 2%

annual interest=2/100-2

                         =2.04%

T is the difference between the discount period of 10 days and credit period of 45 days

45-10=35 days

Effective annual rate of interest=(1+2.04%)^(365/35)-1

                                                      =(1.0204^10.42857143) -1

                                                      = 1.2345  -1

                                                       =0.2345

                                                        =23.45%

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A client invests in an equity indexed annuity that has a guaranteed rate of 3% annual return, a 10% cap and 80% participation. i
34kurt

Answer:

10%

The investor will be credited with the interest at the rate of 10%.

Explanation:

Cap on interest rate which is going to be credited = 10%

Participation=80%

Increase in reference index = 15%

As the participation rate is 80% so the investor can credit the amount of    80%  * 0.15= 12% (15% of 80%) but as it is given in the question, the cap of 10% is put on the interest rate credited so the investor will be credited with the interest at the rate of 10%.

6 0
3 years ago
GDP excludes the value of goods produced at home. many items are counted twice or more in the intermediate stages of production.
Softa [21]

Answer:

False

Explanation:

GDP or gross domestic product value is a measure of the total value of all products and services produced within the boundaries of a country in a given time. It factors all products, regardless of who manufactures them, whether foreigners or locals, men or women. To avoid double-counting, GDP considers finished products only.

In calculating GDP, economists will deduct the cost of imports. The reason is that imports are produced in foreign countries. The value of GDP indicates whether the economy is expanding or contracting. An increase in GDP shows economic growth in the country. An increase in capital goods, human capital, labor force, technology,  contribute to economic growth.

7 0
3 years ago
Sheridan Company applied FIFO to its inventory and got the following results for its ending inventory. Cameras 113 units at a co
ICE Princess25 [194]

Answer:

Ending inventory is <u>$24,917</u>.

Explanation:

Lower-of-cost-or-net realizable value method implies that whichever is lower between the cost per unit and the net realizable value per unit is used to value the ending inventory of an item.

The ending inventory can therefore be determined as follows:

<u>For Cameras:</u>

Units = 113

Cost per unit = $61

net realizable value per unit = $74

We choose cost per unit since it is lower and we have:

Cameras ending inventory = 113 * $61 = $6,893

<u>For Blu-ray players:</u>

Units = 153

Cost per unit = $77

net realizable value per unit = $50

We choose net realizable value per unit since it is lower and we have:

Blu-ray players ending inventory = 153 * $50 = $7,650

<u>For iPods:</u>

Units = 133

Cost per unit = $86

net realizable value per unit = $78

We choose net realizable value per unit since it is lower and we have:

iPods ending inventory = 133 * $78 = $10,374

<u>Calculation of ending inventory:</u>

Ending inventory = Cameras ending inventory + Blu-ray players ending inventory + iPods ending inventory = $6,893 + $7,650 + $10,374 = $24,917

8 0
2 years ago
This barrier of trade is when trading partners do NO trade with another country:
sukhopar [10]

Answer:

C. Embargo

Explanation:

Trade Barriers are the conditions or restrictions that are imposed on the business transactions that controls the business to be sold out to the hands of foreign markets. These barriers add obstacles so that the businesses are restricted through various means. When a complete ban is imposed on the import or export of any goods to the foreign markets, the situation is termed as embargo. This type of ban is imposed for the defense purposes.

4 0
2 years ago
3. The media consumer who gets news and information in a crossover fashion, from a variety of sources is known as a(n) _________
Rus_ich [418]

Answer:

Hybrid

Explanation:

6 0
3 years ago
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