Answer:
If you wait one year, in 45 years you will have $16,624.04 more than investing today.
Explanation:
Giving the following information:
Option 1:
Initial investment= $11,500
Number of years= 45
Interest rate= 4.1%
Option 2:
Initial investment= $11,500
Number of years= 44
Interest rate= 4.7%
To calculate the future value for both options, we need to use the following formula:
FV= PV*(1+i)^n
<u>Option 1:</u>
FV= 11,500*(1.041^45)= $70,142.41
<u>Option 2:</u>
FV= 11,500*(1.047^44)
FV= $86,766.45
If you wait one year, in 45 years you will have $16,624.04 more than investing today.
Answer:
The calculation will be more accurate, because the base year is the oldest.
CPI is calculated as
(P_n / P_base - 1)*100
as:
P_n prices at time n
The mathematical reason why it is better to take the oldest year is that % growth works better
If Ray earns $900 a week and deductions are 28% Ray's take home pay is:
$648 a week
If we assume that the deductions of 28% are taken out of the $900 weekly we will multiply 900 by 0.28 = 252. Then subtract 252 which is the deduction amount from the 900 and we end up with take home pay of $648.
Answer:
a. Savers who lend money are willing to accept a lower minimum interest rate than potential savers who do not lend money.
b. Investment projects that are financed by savers have larger rates of return than projects that do not receive financing.
Explanation:
Loanable funds refer to the aggregate amount of money that all sectors, entities and individuals within an economy have decided to keep as an investment, instead of spending on personal consumption, by saving and giving them out as loans to borrowers.
The market for loanable funds is in equilibrium when the supply of loanable funds by the saver is equal to demand for loanable funds by the borrowers at a given interest rate.
When the market for loanable funds is in equilibrium, efficiency is maximized because projects that have higher rates of return are given priority to be funded first before the projects with lower rates of return are funded. The reason is that savers that have lowest costs of lending provides funds for the projects that have highest return rates in equilibrium. However, potential saver who do not lend money will prefer a higher interest rates.
Therefore, the correct options related to the two aspects of efficiency that the equilibrium of market for loanable funds exhibits are as follows:
a. Savers who lend money are willing to accept a lower minimum interest rate than potential savers who do not lend money.
b. Investment projects that are financed by savers have larger rates of return than projects that do not receive financing.
Answer:
Inferential statistics.
Explanation:
Inferential statistics involves making use of data to make generalisations.
