Answer:
cab fares will be higher.
Explanation:
The supply of cabs would fall as a result of the limit. The fall in supply would lead to a rightward shift of the demand curve for cabs.
As a result, equilibrium price (cab fares) would increase and equilibrium quantity would fall.
subway is a substitute for cabs
Due to the increase in the price of cabs, there would be an increase in the demand for subway. This would lead to a rise in equilibrium price and quantity
To get the formula for the principal, we will use the
formula for the interest and derived it from there:
I = Prt is the equation then it will be P = I /rt since we
are looking for the principal.
P = I /rt
= $500 / (0.145 x 240/360)
= $500 / 0.0967
= $5170.63
To check:
I = Prt
= $5170.3 x 0.145 x 240/360
= $499.8 or $500
Answer:
$23,709
Explanation:
Data provided in the question:
Amount of bond issued = $700,000
Duration = 5 years
Interest rate = 8%
Selling amount of bond = $728,700
Market rate of interest = 7%
Now,
Interest paid = Amount of bond issued × Interest rate
= $700,000 × 0.08
= $56,000
Interest expense = Amount of bond sold × Market Interest rate
= $728,700 × 0.07
= $51,009
unamortized premium = Selling amount of bond - Amount of bond issued
= $728,700 - $700,000
= $28,700
Amortized amount = Interest paid - Interest expense
= $56,000 - $50,009
= $4,991
Balance of the premiums on bonds payable account immediately following the first interest payment
= unamortized premium - Amortized amount
= $28,700 - $4,991
= $23,709
