Answer:
A Banker's Analysis of an Automotive Company for Loan
Most important consideration in determining grant of loan:
c. The company has a large amount of interest payments related to other outstanding loans.
Explanation:
The large amount of interest payments related to other outstanding loans means that the automotive company is highly leveraged. To grant a bank loan will have added leverage risk.
In analyzing the request for a loan, a bank should consider the borrowing company's credit history. With so much in interest payments, the company has already borrowed heavily. The banker should consider the application of the past debts. Were they used in investments or for working capital purposes or to repay liabilities and shareholders.
The banker also needs to review the cash flow history with line with the above, to know how the past debts have been applied, as already stated above. In reviewing the cash flow history, the projections of the company should be tested for sustainability. "Has the company been meeting its past projections?" is a relevant question to understand.#
Lastly, the banker should also consider the existence of collateral for the loan, especially given that the company is highly leveraged. Are there unencumbered assets that can serve as collateral in case of default?
<em>Answer:</em>
<em>Answer:Insurance policies offer protection against economic loss, that is, loss or damage which can be measured in purely financial terms and compensated by money. When you buy homeowners property insurance.</em>
Explanation:
<em>When you buy homeowners property insurance, for example, you are insuring only the economic value of the home, i.e., the cost to repair or rebuild it.</em>
Answer:
prime mortgage insurance (PMI) is an insurance that mortgage lenders require when borrowers make a down payment of less than 20% of the purchase price of the house.
We are not given any table, so I looked in the internet to find one that can be used as an example:
outstanding principal = $142,000 - 17% = $117,860
- mortgage term equal or less than 15 years
- base loan amount is less than $625,000
- loan to value ratio = 1 - down payment = 83%, which means it is ≤ 90%
- bps = 45
total yearly premium = principal x bps = $117,860 x 0.0045 = $530.47
monthly PMI payment = $530.47 / 12 months = $44.20
Answer:
The answer is avg cost curve
Explanation:
The long-term result of entry and exit in a perfectly competitive market is that all firms end up selling at the price level determined by the lowest point on the avg cost curve
Explanation:
This is circular flow model with three agents ; customers , governments and businesses.
There are two markets ; Goods and services market and factor market.
The two types of transaction are resources or monetary transaction.
▼ you buy a coffee at starbucks : It is a trade between companies, households with commodities and households. This is achieved via the demand for goods and services.
▼ the government buys some dell computers : This is the exchange of the money market between the government and goods and services. Assets are transferred from government to market for goods and services.
▼ a student works at kinko : The transaction includes the demand element from the household to the resource sector. It is a financial transaction between companies and households.
▼ donald trump rents a building to marriot hotels: It is a monetary transaction across the factor network from business to households. This is indeed a resource transaction between households and companies via the factor market.
▼you pay your income tax : This is indeed a money transaction between households and government.
