Answer:
The borrower is best off in situation <u>"a"</u> and the lender is best off in situation ▼ "C" .
Explanation:
Considering all the situations given in the options, the <u>borrower</u> is best in situation <u>a</u> and <u>lender</u> is best off in situation in <u>c</u>.
<u>Part a </u>
Real Interest rate = Nominal Interest rate - Inflation rate = 14 - 17 = -3 per cent. Thus, the purchasing power of money has fallen and the person has to pay back money with little purchasing power as compared to the value of the purchasing power at the time he borrowed money. Thus, borrowers are best off.Thus, <u>borrower</u> is best off when the inflation rate is very high.
<u>Part c</u>
Inflation rate is negative, thus the purchasing power of money will increase and lenders will get back money with higher purchasing power as compared to the value of the purchasing power of money at the time he lend the money. Thus, <u>lender </u>is best off when inflation rate is lowest.
Answer:
The amount of interest is $576.
Step by step explanation :
Given : Enrique borrowed $3600 to put a down payment on a motorcycle. The loan had a simple interest rate of 8% for 2 years.
To find : The amount of interest he will pay on the loan.
Solution : Using the formula,
Where, I= Interest , P=principal , R= rate, T=time in years
We have given that :
P=$3600
R=8%=0.08
T=2 years
Substitute value in the formula to find interest,
Therefore, The amount of interest is $576.
Answer:
$60000
Explanation:
Their are 1000 products to produce per week for 30 weeks.
Total of product = 30* 1000
= 30000
For every 100 products, the filter needs to be changed, and it cost $50.
The number of filter used is
= 30000/100
= 300.
So the product cost $1.5
Total cost =
($1.5*30000)+($50*300)
= $45000+$15000
= $60000
Answer:
The correct answer is letter "D": There will be downward pressure on the prices.
Explanation:
Price floors are the minimum legal prices that buyers are expected to pay for a product. These prices are usually set by law with the intervention of the government. In the case the price floor is removed, the price tendency is to go down since as there is no minimum price anymore, buyers could take advantage of the situation to offer less money for the same product.
Answer: Option D
Explanation: Mary Parker believed that management is the art of making people do things you want. To achieve this both senior and subordinates should work in collaboration.
In the given case, the employees in the organisation are starting cliques, that is they are not accepting the outsiders and are not communicating with them. Thus, if the employees develop an attitude that they are a community then they could collaborate with each other.
Hence from the above we can conclude that the correct option is D.
