Answer:
How much do you make in interest in a year?
<u>$ 1100</u>
How much would you need to have made for your spending power to keep up with inflation in that year?
<u>$ 1782
</u>
How much buying power did you lose in that year because of inflation?
<u>$ 682
</u>
Explanation:
Your interest formula is given to you.
Interest in a year = principal (the amount invested) * rate (the interest rate) * period (the time you're measuring)
Interest = 55,000 * 2% * 1 year = 55,000 * 0.02 * 1 = $1,100
How much would you need to have made for your spending power to keep with inflation? Your interest rate would have needed to match the inflation rate, otherwise prices are going up faster than you're saving.
Required interest = 55,000 * 3.24% * 1 year = 55,000 * 0.0324 * 1 = $1,782
How much buying power did you lose? The difference between your required interest and your actual interest.
Buying power lost = 1,782 - 1,100 = $682. You lost this much in buying power.
Hope that helped :)
The correct answer is a single payment loan.
This means that he will pawn his watch to a pawnbroker, who will pay him the entire sum immediately, without having to use monthly installments or something like that. A single payment loan refers to the payment of the entire principal sum at that particular moment when the loan is taken.
$8,445 = 844,500 cents
844,500 : 6.3 = 134,047.61
134,047.61 · 100 = $13,404,761 ≈ $13.4 million
Answer:
C ) $13.4 million
Answer:
Explanation:
The cost of the car = $40,000
Down payment = $5,000
Therefore loan amount on the car = Cost of the car - Down payment
= $40,000 - $5,000
= $35,000
But loan repayment starts from 13th months; therefore there are 12 months or 1 year for which interest amount will be added with the total loan amount
Total loan amount after one year = $35,000 * (1+6%) ^1 = $37,100
Now we can use PV of an Annuity formula to calculate the monthly payment of car loan
PV = PMT * [1-(1+i) ^-n)]/i
Where PV = $37,100
PMT = Monthly payment =?
n = N = number of payments = 60 months
i = I/Y = interest rate per year = 6%, therefore monthly interest rate is 6%/12 = 0.5% per month
Therefore,
$37,100 = PMT* [1- (1+0.005)^-60]/0.005
PMT = $37,100/51.72
= $717.38
Therefore correct answer is option A. $717.38
Answer:
$7,000
Explanation:
Data provided in the question:
Beginning balance = $2,000
Office Supplies expenses = $8,000
Ending balance = $1,000
Now,
Let the amount of office supplies purchased be 'x'
Therefore,
Ending balance = Beginning balance + Purchases - Office Supplies expenses
or
$1,000 = $2,000 + x - $8,000
or
$1,000 = - $6,000 + x
or
x = $7,000