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hammer [34]
1 year ago
10

After graduating this May, Dale is planning on buying a new Ferrari for $250,000. He decides to finance his new car with a 5 yea

r loan from Citibank with a 12% interest rate. His annual payment is $48,986. What will Dale's principal payment be at the end of the first year? Group of answer choices a) $5879 b) $10000 c) $18986 d) $50000.
Business
1 answer:
jek_recluse [69]1 year ago
3 0

Answer:

c) $18,986

Explanation:

The computation of the payment of principal is shown below:

= Annual payment - (Balance of Principal × interest rate)

= $48,986 - ($250,000 × 12%)

= $48,986 - $30,000

= $18,986

We do not consider the time period. Hence, we ignored it as it is not relevant for the computation part.

We simply multiply the principal balance with the interest rate and then deduct it from the annual payment.

You might be interested in
Unscramble the vocabulary word from Chapter 12: yalplor
makvit [3.9K]

Payroll is your answer.

Payroll is a list that have all employees listed on it as well as the amount they were to be paid during a certain amount of time.

~

7 0
2 years ago
Suppose Boyson Corporation's projected free cash flow for next year is FCF1 = $150,000, and FCF is expected to grow at a constan
bearhunter [10]

Answer:

The total corporate value of the firm is $3,000,000

Explanation:

The total corporate value of the firm is computed as:

Total corporate value = FCF1 / (average cost of capital - Growth rate)

Where

FCF1 is $150,000

Growth rate is 6.5%

average cost of capital is 11.5%

Putting the values :

= $150,000 / (11.5% - 6.5%)

= $150,000 / 5%

= $3,000,000

8 0
2 years ago
Byron Books Inc. recently reported $13 million of net income. Its EBIT was $20.8 million, and its tax rate was 35%. What was its
grigory [225]

Answer:

Interest expense = $800,000

Explanation:

Given:

Net income = $13,000,000

EBIT = $20,800,000

Tax rate = 35% = 0.35

Find:

Interest expense

Computation:

Net income= (EBIT - Interest expense) × ( 1-tax rate)

$13,000,000 = [$20,800,000 - Interest expense][1-0.35]

20,000,000 = [$20,800,000 - Interest expense]

Interest expense = $800,000

4 0
1 year ago
Burton Bush wants to retire in Arizona when he is 80 years of age. Burton, who is now 55, believes he will need $500,000 to reti
Rudik [331]

Answer:

$116,499.15

Explanation:

To find the amount he will have to invest today, we have to find the present value of $500,000 at the 6% interest rate

PV = FV (1+r)^-n

PV = Present value

FV = Future value = $500,000

R = interest rate = 6%

N = number of years = 25

$500,000 ( 1 + 0.06) ^-25 = $116,499.15

I hope my answer helps you

8 0
2 years ago
Target's brand promise "Expect More. Pay Less" and appeal to higher-income, fashion-conscious discount shoppers illustrates the
blagie [28]

Answer:

The correct option is D. integrated cost leadership/differentiation

Explanation:

Integrated cost leadership/differentiation is a business level strategy where differentiated products are offered in market at low cost.

Differentiated product signifies the unique characteristics the customer values and cost leadership signifies that the product is offered at the lower-cost, i.e., at a margin just above average costs.  

It is useful in gaining wide customer base especially in a global frontier.

8 0
1 year ago
Read 2 more answers
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