Answer:
Addison will have $ 1,661 in her account in nine years.
Explanation:
This problem requires us to calculate value of our investment of $ 1000 dollars after nine years. The interest on the investment is 5.8% compounded annually.
This problem can be solved by using simple compounding formula given below.
Future Value = Present Value (1+interest rate%)^-period
Future Value = 1,000 (1+5.8)^9
Future = $ 1,661
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
Answer:
In order to find IRR we have to set the present value of all cash flows to 0,
IRR is the rate at which if we discount the payments the NPV (net present value) will be 0
-1875000+
415,350/(1+IRR)
415,350/(1+IRR)^2
415,350/(1+IRR)^3
415,350/(1+IRR)^4
415,350/(1+IRR)^5
415,350/(1+IRR)^6
415,350/(1+IRR)^7
Now we can use trial and error to see at what rate will the npv be
IRR= 12.35%
Another simple way of doing is using the cash flow function of a financial calculator and input these values.
CF0=1875000
C01=415,350
C02=415,350
C03=415,350
C04=415,350
C05=415,350
C06=415,350
C07=415,350
Explanation:
Is called collusion
It's actually price collusion to be precise ( not to be mistaken for the crime collusion)
Often time, to attract customers, sellers will offer a lower price than their competitor. Though it may attract more customer, it will lower their profit.
In price collusion, all sellers is guaranteed to have same product price and profit margin, creating a perfect competition market for that product
