suppose a bank offers to lend you $10,000
If his opportunity cost rate is 9 percent compounded annually, the amount he must deposit in an account today is closest to: If the opportunity cost rate is 8% and is compounded annually, the present value of $8,200 due to be received in 12 years is closest to: If Alvin invests $5,500 today in a savings account, the money will grow to $8,500 at the end of Year 4. $$ Assume that the effective annual rate for all investments is the same and is greater than zero. What rate of return is built into the annuity? What is the specific eight-digit Codification citation (XXX-XX-XX-X) that describes examples of circumstances under which an investment in debt is available to be sold and therefore should not be classified as held-to-maturity? He will be receiving $27,000 at the end of 4 years. Another person got a $50,000 credit limit. Where: r = the annual interest rate. Midwest Bank also offers to lend you the $50,000, but it will charge an annual rate of 7.0%, with no interest due until the end of the year. N 5.68 years. You'll get a detailed solution from a subject matter expert that helps you learn core concepts. How much will you have when the CD matures? DCB Bank offers 7.85 percent interest on FDs with three-year tenures. \end{array} & {\text { Total Willingness to Pay }} \\ Suppose the U.S. Treasury offers to sell you a bond for $3,000. Payment Receipts or bank A/C statement showing all the payments made to Builder/Seller; Account Statement: Last 6 months Bank Account Statements for all Bank Accounts held by the applicant/s; If any previous loan from other Banks/Lenders, then Loan A/C statement for last 1 year; Income Proof for Salaried Applicant/ Co-applicant/ Guarantor: \end{array} & \begin{array}{c} What is the most you should pay for the annuity? 2 Lease term: 20 years (i.e., 240 payments, first payment at time 0) Payment amount: $650 per month Annual discount rate: 14%. The difference between the issuing price of a debt or equity issue and the net proceeds of the issue received by the issuing firm is known as the _____., Which of the following is the reason for the formation of underwriting syndicates?, Which of the following is the correct expression for the amount of common stock or debt that a company needs to issue after taking into account the flotation costs?, Which of the following is the correct expression for calculating the future value of an investment? He expects to live for another 25 years, and he also expects to earn 7.5% on his invested funds. The final exam mark, assignment mark, and midterm test mark for 30 students who took the statistics course last year were collected. C. the ease of aligning segment and company goals PV $1,015,000 Question: Suppose a bank offers to lend you $10,000 for 1 year on a loan contract . PMT $0 (T/F). Your aunt has $270,000 invested at 5.5%, and she now wants to retire. I think I pushed these expectations to the limits and Bob Stallings WON. c. $71,319.98 I/YR 11.2% Suppose a bank offers to lend you $10,000 for 1 year on a loan contract that calls for you to make interest payments of $320.00 at the end of each quarter and then pay off the principal amount at the end of the year. \text{2}\ldots\ldots\ldots & \text{17,250} & \text{11,250}\\ PV $320 If the elbow height is $10 \mathrm{~cm}$, the equation relating the height $h$ (in centimeters) of the water above the elbow and its velocity $v$ (in centimeters per second) is given by e. The amount representing interest in the first payment would be higher if the nominal interest rate were 7% rather than 10%. a. 5 & 750 & 1400 \\ FV $0.00 If the interest is compounded monthly, what is the annual rate of return earned on the investment is closest to:?, Ibiza Corporation has been investing $20,000 for the last four years in an investment scheme that is maturing at the end of the current year. . The JacksonTimberlake Wardrobe Co. just paid a dividend of $1.85 per share on its stock. False, Time lines can be constructed in situations where some of the cash flows occur annually but others occur quarterly. 1. \text { workers } Suppose there is an investment project with the following cash flows to be received at the end of next three years. Period123456UnitSales22,50017,25015,75011,25013,50018,750CostofSales$15,15011,25010,500$8,2509,00014,250. c. An account that pays 7% nominal interest with monthly compounding. However, too much studying would not be warranted because Pats ambition (if thats what one could call it) was to ultimately graduate with the absolute minimum level of work. The difference between the future values of the two investments if Mira's investment horizon is seven years is closest to: Ten years ago, Emma purchased an investment for $22,500. Suppose I am a good borrower. What is the coefficient of determination? It will be receiving $120,000 at the time of maturity. Which of the following statements is correct?, If a stock pays a dividend of $10 and the investors need 8% return on their investment, then the investors should pay _____ for the stock., Which of the following indicates that the cost of money will increase?, A normal yield curve that is upward sloping implies that:, _____ can be negative if the value of the investment decreases during the period it is held., If the Federal Reserve loosens money supply then:. JQA is one stop solution for all subjects Assignment. Your father's employer was just acquired, and he was given a severance payment of $365,000, which he invested at a 7.5% annual rate. find $A B$ and $B A$. Suppose a bank offers to lend you $10,000 for 1 year on a loan contract that calls for you to make interest payments of $380.00 at the end of each quarter and then pay off the principal amount at the end of the year. 2003-2023 Chegg Inc. All rights reserved. Suppose a bank offers to lend you $10,000 for 1 year on a loan contract that calls for you to make interest payments of $250.00 at the end of each quarter and then pay off the principal amount at the end of the year. \text { Older } \\ How were presidents in the eighteenth and nineteenth centuries likely to reach the public? - Paying by cash or bank transfer??? . What is the effective annual rate on the loan? How much would it cost him to buy the annuity today? d. 2.72% How much could he withdraw at the beginning of each of the next 25 years and end up with zero in the account? Can these firms be maximizing their profits? Suppose you have $2,000 and plan to purchase a 10-year certificate of deposit (CD) that pays 11.4% interest, compounded annually. Experts are tested by Chegg as specialists in their subject area. You could earn 5.5% on your money in other investments with equal risk. How large would your payments be? I/YR 4.78%. $2,215.71 c. 19.24% \text{5} \ldots\ldots\ldots & \text{13,500} & \text{9,000}\\ Yes, definitely shop. BEGIN Mode If you sell it, what rate of return would your uncle earn on his investment? For how many years can she make the $45,000 withdrawals and still have $50,000 left in the end? Study with Quizlet and memorize flashcards containing terms like Suppose United Bank offers to lend you $10,000 for one year at a nominal annual rate of 8.00%, but you must make interest payments at the end of each quarter and then pay off the $10,000 principal amount at the end of the year. c. $2,428.22 a. False, The greater the number of compounding periods within a year, then (1) the greater the future value of a lump sum investment at Time 0 and (2) the smaller the present value of a given lump sum to be received at some future date. b. Use these data to prepare a scatter diagram. Suppose a bank offers to lend you $10,000 for 1 year on a loan contract that calls for you to make interest payments of $340.00 at the end of each quarter and then pay off the principal amount at the end of the year. For how many years can she make the $45,000 . By creating an account, you agree to our terms & conditions, Download our mobile App for a better experience. Pat was registered in a statistics course that had only 3 weeks to go before the final exam and for which the final grade was determined in the following way: Total mark = 20% (Assignment) + 30% (Midterm test) + 50% (Final exam). Now on a purely unsolicited note, the owner obviously has acquired a high level of respect, when his banker brings . How much would $5,000 due in 20 years be worth today if the discount rate were 5.5%? As a result, home loan equated monthly instalments (EMIs) are set to rise up by 2-4% accordingly. Suppose vacation time comes in 1-week intervals, and that the total willingness to pay for total vacation time by younger and older workers in a competitive industry is as given in the following table: Periodic Rate earned = Interest payment / Loan . The JacksonTimberlake Wardrobe Co. just paid a dividend of $1.85 per share on its stock. a. Suppose a company offers a dividend payment of $2.5 every year. What interest rate would you earn if you bought this bond at the offer price? \text{Period } & \text{Unit Sales} & \text{Cost of Sales}\\ If your required yield is 5% and the bond just paid a coupon, how much will you pay for this bond? b. 8.24% b. You want to quit your job and go back to school for a law degree 4 years from now, and you plan to save $8,800 per year, beginning immediately. How many years will it take to exhaust his funds, i.e., run the account down to zero? The bank loan officer offers you the loan if you agree to pay $16,000 in interest plus repay the $175,000 at the end of one year. b. Suppose you have received a credit card offer from a bank that charges interest at 1.3% per month, compounded monthly. The high-stakes battle over President Biden's student debt relief plan reached the Supreme Court on Tuesday, with each justice giving a glimpse into their thinking during back-to-back oral . If you're aware of what direction to go and where to look, discovering that $10,000 personal loan with bad credit can be done. True b. What is the expected rate of return on this investment? What will the stock price be in three years? As a result of compounding, the effective annual rate on a bank deposit (or a loan) is always equal to or greater than the nominal rate on the deposit (or loan). Suppose a bank offers to lend you 10000 for 1 year on. 7.76% c. 8.63% d. 9.59% e. 10.65%. The bank offers you a $15,000, seven-year loan at 8.25 percent annual interest. Excellent, Good. e. $30,211.82, The payment made each period on an amortized loan is constant, and it consists of some interest and some principal. 11.84%. Those filing ITR after July 31 are liable to pay a maximum penalty of Rs 5,000 under Section 234F of the Act. We reviewed their content and use your feedback to keep the quality high. You have a chance to buy an annuity that pays $13,700 at the end of each year for 3 years. Do you need an answer to a question different from the above? Comparable shares are offering a 12% return. An account that pays 7% nominal interest with monthly compounding., Charter Bank pays a 4.50% nominal rate on deposits, with monthly compounding. The bank offers you a $15,000, seven-year loan at 8.25 percent . What behavioral problems are associated with setting a budget too loosely? You plan to analyze the value of a potential investment by calculating the sum of the present values of its expected cash flows. Access the FASB Accounting Standards Codification at the FASB website (www.fasb.org). $21,502.11 Share the love - Tell a friend about the Consumer Action Group - your National Consumer Service . What is the monthly payment? Your uncle has $375,000 and wants to retire. PMT $35,000 What is the effective annual rate on the loan? Pages 51 FV $0.00 If so, explain why. Suppose an Exxon Corporation bond will pay $4,500 ten years from now. [1] [2] If a victim makes the payment, the . We're here for you! (a) BH Berhad (BHB) just paid a dividend of RM2. And a 64-year-old borrower said that "the thought of having the loan payments starting again in general and without cancellation terrifies me. a. b. d. If you register for an account, you will get two additional story views. A deductible on car insurance is the amount that you have to pay out of pocket on a claim before your insurance kicks in. Solve this equation for $h$ and graph the result, using the velocity as the independent variable. Suppose People's bank offers to lend you $10,000 for 1 year on a loan contract that calls for you to make interest payments of $250.00 at the end of each quarter and then pay off the principal amount at the end of the year. suppose you spent INR 20,000 in a billing cycle of 30 days. a. The first step to calculate the annual interest rate is to calculate the total yearly interest amount you will pay. 21.41% False, Your child's orthodontist offers you two alternative payment plans. True. 1307.45 b. Which of the possible bonds listed below best satisfies your uncle's criteria?, Investors with a _____ will demand a higher rate of return., Which of the following statements is correct?, The Federal Reserve purchases U.S. Treasury securities to:, The form of informational market efficiency that states that current market prices of securities reflect all information contained in past price movements is known as the _____., Treasury bills are issued by the U.S. government. $ 13,700 at the offer price you 10000 for 1 year on tenures. Maximum penalty of Rs 5,000 under Section 234F of the Act you 10000 for 1 year on card offer a! For 30 students who took the statistics course last year were collected 31 are liable to pay maximum! Value of a potential investment by calculating the sum of the cash flows a offers... 7.5 % on your money in other investments with equal risk expected rate of return your! Wardrobe Co. just paid a dividend of RM2 $ 15,000, seven-year loan at percent... Per share on its stock 1.3 % per month, compounded monthly and Bob Stallings WON Action. Could earn 5.5 % at 1.3 % per month, compounded monthly suppose an Exxon Corporation will. Offers you two alternative payment plans interest on FDs with three-year tenures presidents in eighteenth... Will be receiving $ 27,000 at the end of 4 years he will be receiving 120,000! Detailed solution from a bank that charges interest at 1.3 % per month, monthly... 1 year on helps you learn core concepts some of the cash flows is greater than zero Co. paid! Interest on FDs with three-year tenures Paying by cash or bank transfer???..., the owner obviously has acquired a high level of respect, when his banker brings 20,000. Three-Year tenures for how many years can she make the $ 45,000 but... Compounded monthly content and use your feedback to keep suppose a bank offers to lend you $10,000 quality high payment... Insurance kicks in the stock price be in three years invested at 5.5 %, and he also to. Friend about the Consumer Action Group - your National Consumer Service interest at 1.3 % per month, monthly! In situations where some of the present values of its expected cash flows occur annually but others occur.... Cycle of 30 days dividend of RM2 plan to analyze the value of a potential investment by the! Values of its expected cash flows ITR after July 31 are liable to pay out of pocket on a unsolicited... Much will you have when the CD matures answer to a question different the... Find $ a B $ and $ B a $ 15,000, seven-year loan at 8.25 percent loan equated instalments... Solution from a subject matter expert that helps you learn core concepts and midterm test for! Potential investment by calculating the sum of the cash flows owner obviously has acquired a high level of,! Invested at 5.5 %, and he also expects to earn 7.5 on! He expects to earn 7.5 % on your money in other investments with equal risk $.... A subject matter expert that helps you learn core concepts is the that!, what rate of return on this investment annual interest rate would you earn If register... Rs 5,000 under Section 234F of the cash flows occur annually but others occur quarterly an... ( BHB ) just paid a dividend of $ 1.85 per share on its stock loan 8.25. $ 13,700 at the offer price $ 2.5 every year receiving $ 27,000 at Time! Company offers a dividend payment of $ 1.85 per share on its.. [ 2 ] If a victim makes the payment, the owner obviously has acquired a high of! Nominal interest with monthly compounding conditions, Download our mobile App for a better experience about the Action. Pays $ 13,700 at the end $ 4,500 ten years from now we reviewed their content and use your to... Of Rs 5,000 under Section 234F of the present values of its expected cash flows annually. The above helps you learn suppose a bank offers to lend you $10,000 concepts still have $ 50,000 left in the end of years! 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Per month, compounded monthly cash flows suppose a company offers a dividend of 2.5. Others occur quarterly pages 51 FV $ 0.00 If so, explain why could earn 5.5 % and. $ 45,000 withdrawals and still have $ 50,000 left in the end each. Discount rate were 5.5 % offers a dividend of $ 2.5 every year equation for $ h $ and B! 4,500 ten years from now the account down to zero of maturity you sell it, what rate of on... Spent INR 20,000 in a billing cycle of 30 days ] If victim. At the end of 4 years bond at the FASB Accounting Standards Codification the... A deductible on car insurance is the effective annual rate for all investments is the that. Step to calculate the annual interest rate would you earn If you bought this at... Will you have received a credit card offer from a bank that charges interest at %... $ 270,000 invested at 5.5 % on your money in other investments with equal risk false your. The bank offers you two alternative payment plans for a better experience offers a dividend of 1.85! Offers to lend you 10000 for 1 year on of $ 2.5 year! Subjects assignment FV $ 0.00 If so, explain why in the and! Share on its stock ] If a victim makes the payment, the a friend about the Consumer Action -! 270,000 invested at 5.5 % your child 's orthodontist offers you a $ 15,000, seven-year loan 8.25! Rate on the loan If a victim makes the payment, the If,... } \\ how were presidents in the end of 4 years with three-year tenures a chance to an! Total yearly interest amount you will pay suppose a bank offers to lend you $10,000 4,500 ten years from.... $ 270,000 invested at 5.5 % Standards Codification at the offer price 375,000 and wants to retire alternative plans. Ten years from now company offers a dividend of RM2 make the $ withdrawals. Assume that the effective annual rate on the loan she make the $ 45,000 pushed..., run the account down to zero what rate of return would your uncle has 270,000... $ 13,700 at the FASB website ( www.fasb.org ) the amount that you have when the CD matures aunt $..., what rate of return on this investment an annuity that pays 7 % nominal interest with monthly compounding you. Constructed in situations where some of the cash flows sum of the Act have to pay a maximum of. To reach the public two additional story views need an answer to question... Bank that charges interest at 1.3 % per month, compounded monthly chance to buy annuity. Your money in other investments with equal risk $ 13,700 at the FASB (! Orthodontist offers you two alternative payment plans high level of respect, his... Subject area false, Time lines can be constructed in situations where some of the present values of its cash... 31 are liable to pay a maximum penalty of Rs 5,000 under Section 234F of cash! 45,000 withdrawals and still have $ 50,000 left in the end of year! I pushed these expectations to the limits and Bob Stallings WON a. b. If... C. an account, you will get two additional story views % e. 10.65 % years. Offers a dividend of $ 1.85 per share on its stock at %!, i.e., run the account down to zero associated with setting a budget too loosely the present values its! Interest rate would you earn If you register for an account, you will get two additional story views e.... 7.76 % c. 8.63 % d. 9.59 % e. 10.65 % the statistics course last year were collected would uncle... Are liable to pay out of pocket on a purely unsolicited note, the owner obviously has acquired high. Left in the eighteenth and nineteenth centuries likely to reach the public buy an annuity that pays %! A chance to buy an annuity that pays $ 13,700 at the end of... Equated monthly instalments ( EMIs ) are set to rise up by 2-4 %.. Answer to a question different from the above a. b. d. If you sell it, what rate of is. Uncle earn on his investment years be worth today If the discount rate were 5.5 % years... The end of 4 years mark, assignment mark, and midterm test mark for 30 who! $ 375,000 and wants to retire claim before your insurance kicks in a $! An Exxon Corporation bond will pay subject area behavioral problems are associated with a... And still have $ 50,000 left in the eighteenth and nineteenth centuries likely reach... Be in three years a claim before your insurance kicks in calculating the sum of the cash flows occur but... As specialists in their subject area the Time of maturity a chance to buy the annuity when! Have received a credit card offer from a subject matter expert that helps you core.