1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
Whitepunk [10]
3 years ago
15

Method A assumes simple interest over final fractional periods, while Method B assumes simple discount over final fractional per

iods. The annual effective rate of interest is 20%. Find the ratio of the present value of a payment to be made in 1.5 years computed under method A to that computed under Method B.
Business
1 answer:
Marina86 [1]3 years ago
4 0

Answer:

The answer is "1.1"

Explanation:

In the case of a single Interest, the principal value is determined as follows:

\ I = Prt \\\ A = P + I\\A = P(1+rt) \\\\A = amount \\P= principle\\r = rate\\t= time

In case of discount:

D = Mrt \\P = M - D \\P = M(1-rt)\\\\Where,  D= discount \\M =\  Maturity  \ value \\

Let income amount = 100, time = 1.5 years, and rate =20 %.

Formula:

A = P(1+rt)  

A =P+I

by putting vale in the above formula we get the value that is = 76.92, thus method A will give 76.92  value.

If we calculate discount then the formula is:

P = M(1-rt)

M = 100  rate and time is same as above.

P = 100(1-0.2 \times 1.5) \\P = 100 \times \frac{70}{100} \\P = 70

Thus Method B will give the value that is 70  

calculating ratio value:

ratio = \frac{\ method\  A \ value} {\ method \ B \ value}\\\\\Rightarrow ratio = \frac{76.92}{70}\\\\\Rightarrow ratio = \frac{7692}{7000}\\\\\Rightarrow ratio = 1.098 \ \ \ \  or \ \ \ \  1.

You might be interested in
Anthony was employed as a forklift operator for Blackburn Construction Company. While on the job, he operated the forklift in a
QveST [7]

Answer:

Option A

Explanation:

6 0
2 years ago
Spain's discoveries in the new world showed other european countries that
Ann [662]
Spain was progressive and strong. It showed other countries that Spain was a leader
5 0
2 years ago
The following events occurred for Johnson Company: a. Received investment of $39,000 cash by organizers and distributed 1,190 sh
soldi70 [24.7K]

Answer:

Cash 39.000 debit

  Common Stock       1,190 credit

  Additional Paid-in 37,810 credit

Equipment  7,100 debit

  Cash                  1,300 credit

  Note payable   5,800 credit

Cash    15,000 debit

 Note payable 15,000 credit

Explanation:

We debit the cash received and credit the face value of the common stock

the difference is label as additional paid-in common stock which, is also credited.

as the equipment is worth 7,100 and we paid 1,300 cash the differnece: 7,100 - 1,300 = 5,800 is the principal of the note signed

As the equipment which enters the firm is  an asset it wil lbe debited.

the cash is being used thus, credited and the note is a liability hence credit as well

the third event consist of a inflow of cash thus debit and taking a liability therefore, credit.

8 0
3 years ago
Establishing the structure of a portfolio to meet specific financial goals is called:
photoshop1234 [79]

Answer:

A I believe

Explanation:

4 0
3 years ago
Silver Enterprises has acquired All Gold Mining in a merger transaction. The following balance sheets represent the premerger bo
tamaranim1 [39]

Answer:

                   Silver Enterprises Post Merger Balance Sheet

Current Assets                  12,920    Current liabilities          10,460

Other Asset                       4,480      Long-term debt            19,770

Net Fixed Asset                24,810     Equity                           17,450

Goodwill                            <u>5,470  </u>                                           <u>              </u>

                                         <u>$47,880</u>                                         <u>$47,680</u>

Explanation:

Current assets = 10,000 + 2,920 = 12,920

Other assets = 3,100 + 1,380 = 4,480

Current liabilities = 7,840 + 2,620 = 10,460

Net fixed assets = 17,300 + 7,510= 24,810

Long-term debt = 5,110 + 14,660  = 19,770

Equity = $17,450

8 0
3 years ago
Other questions:
  • In the portfolio matrix, characteristics of goods and services in the leverage quadrant are: Group of answer choices competitive
    5·1 answer
  • you have 1500 parts in inventory at the beginning of your shift, your total parts for the day need to be 2300. How many more par
    15·1 answer
  • he employees at Purple &amp; Gold Inc. are expected to complete their work and leave the office premises by 6:00 p.m. Team outin
    10·1 answer
  • 1. Why have OpenTable competitors had a difficult time competing against OpenTable? 2. What characteristics of the restaurant ma
    15·1 answer
  • A large offshore oil field has attracted the interest of many oil drillers. The oil field is not owned by​ anyone, and any firm
    6·1 answer
  • Which payment option could have interest charged to you?
    13·1 answer
  • If lenders are seeking a 3% real interest rate, the inflation rate is expected to be 6%, and real GDP is growing at 4%, what nom
    5·1 answer
  • Cantlay, Inc., earns pretax book net income of $800,000 in 2019. Cantlay acquires a depreciable asset that year, and first-year
    5·1 answer
  • Windhoek Mines, Ltd., of Namibia, is contemplating the purchase of equipment to exploit a mineral deposit on land to which the c
    8·1 answer
  • From day one of Jay's first week as the new boss, everybody in the office agreed that he was a great improvement on his predeces
    7·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!