A saving account earns a nominal rate i(©) = 0.06. If the income tax of the earnings from this account is at 25%, and suppose the annual inflation is at 2.4%, what is the annual after tax real rate of return? ) 0.0216 ) 0.0275 0.0205 0.0366

Q: al rate of interest on a bank account is 2.5% and the general rate of inflation is 4%. b) Using the…

A: Given information :

Q: Suppose your credit card issuer states that it charges a 24.00% nominal annual rate, but you must…

A: Effective Annual Rate(EAR) = [(1+ nominal rate/n)^n]-1 where, n = compounding period

Q: find the nominal rate which is converted quarterly could be used instead of 11.88% compounded…

A: The nominal interest rate is the periodical interest rate times the numberof periods per year . For…

Q: Assume a bank offers an effective annual rate of 7.20%. If compounding is monthly what is the APR?…

A: Annual percentage rate is the rate of interest which is charged to borrowers by the lenders and…

Q: What is the effective annual rate (EAR) if your credit card charges you 10.45 percent compounded…

A: The effective annual rate measures the rate of interest or return when the compounding is done on a…

Q: A lending institution charges interest at the rate of 3.5% per quarter, a. What is the nominal…

A: Interest rate per quarter = 3.5%   a. What is the nominal interest rate?       Nominal interest rate…

Q: An investment pays you 9% interest, compounded quarterly. What is the periodic rate of interest?…

A: Using excel effective rate of interest function

Q: Suppose you saw a sign at your local bank that said, "4.3% rate compounded monthly- 4.7% Annual…

A: Effective Annual Rate is a modified rate of return where it considers the compounding effect.…

Q: he following:   Spot USDBRL = 5.0500             1YR USD Money Market Rates = 1.50%…

A: The interest rate and exchange rates are related to each and changes with changes in the interest…

Q: What nominal interest rate compounded semi-annually is equivalent to j52 14%?

A: Nominal Interest rate Nominal interest rate refers to the simple annual interest rate without…

Q: You are told the effective interest rate on an account is 2.1%, if the interest is compounded…

A: Formulas:

Q: P500,000 was deposited for a period of 5 yrs. And 6 months and bears on interest of P85,659.25.…

A: The rate of interest is the percentage that is charged on the loan of amount.

Q: ective rate of interest on an investment is 5.52%, what is the nominal rate of interes nded monthly?

A: Solution:- Effective rate of interest means the net interest rate for the year after effect of all…

Q: 1. Using the example of a savings account, explain the difference between the effective annual rate…

A: Saving account is the type of deposit account in which interest is paid on the amount deposited.…

Q: In a discount interest loan, you pay the interest payment up front. For example, if a 1-year loan is…

A: Excel Spreadsheet:

Q: 7A-19. What is the nominal dollar value of the interest tax savings to the firm in the third year of…

A: Please find the answer to the above question below:

Q: If the interest rate per day is 0.014%, then what is the annual rate?

A: Interest rate:An interest rate is a percentage on the principal amount at which a lender gives money…

Q: Bank ZLY is charging customers a loan rate of 9.2% APR compounded monthly.  What is the equivalent…

A: Equivalent Effective Annual rate= It refers to that interest rate which is actually earned on a…

Q: An interest pays 1% interest rate, calculate the nominal rate of interest compounded weekly?

A: Interest rate can be defined as the percentage rate at which the interest over the investment or…

Q: If you bought a 4-week T-bill for Tk.887 and receive Tk.1,200 4 weeks later, what is the effective…

A: The Effective Annual Interest Rate (EAR) is the interest rate that is adjusted for compounding over…

Q: Savings institutions often state a nominal rate, which can be thought of as a simple annual interest…

A: Effective rate refers to actual return that an investment will generate in a period after…

Q: In a discount interest loan, you pay the interest payment up front. For example, if a 1-year loan is…

A: Given: Interest rate = 8.50% Amount borrowed = $42,000 Interest amount = $3,570 Net loan = $38,430

Q: Assume the average management cost per account per year is $200 and the average fees earned per…

A: Average management cost per account per year= $200  Average fees earned per account per year= $170…

Q: Savings institutions often state a nominal rate, which can be thought of as a simple annual interest…

A: The effective annual interest rate refers to the rate that is actually earned on an investment or…

Q: LMN Corp has the following data showing for the current year: Interest on peso savings account, net…

A: Solution Concept The interest deduction allowable is 20% of the interest income that is chargeable…

Q: You put money into an account that earns a 8 percent nominal interest rate. The inflation rate is 3…

A: Nominal interest rate includes expected inflation.

Q: . If a bank advertises a savings account that paysan 8% nominal interest rate compounded…

A: The question is based on the concept of calculation of effective annual interest rate in case of…

Q: A bank offers 6.00% on savings accounts. What is the effective annual rate if interest is compounded…

A: The effective annual rate of interest is the real return on the savings account when the effects of…

Q: Find the nominal rate compounded quarterly which is equivalent to 12% compounded semimonthly. O…

A: First we need to use effective annual rate formula to calculate nominal rate Effective annual rate…

Q: A bank quoted 10% annual interest rate. If the bank compounds the interest rate quarterly, what…

A: Quarterly rate = Annual rate / Number of quarters in a year Quarterly rate =10% /4 Quarterly rate…

Q: (a) Find the present value of a payment of £500 made after 3 months using a simple rate of discount…

A: The concept of the time value of money is used to find out the actual value of money based on the…

Q: An account pays 7% annual interest compounded monthly.  What is the effective interest rate on this…

A: A 7% annual interest compounded monthly implies that a monthly interest of 7%/12 is being compounded…

Q: f i 5.8% per semiannual, compounded monthly, What is the nominal quarter rat

A: solution concept semi annual rate means the rate that is quoted for 6 months in compound interest…

Q: What is the effective annual interest rate if the nominal annual interest rate is 24% per year…

A: EAR is the effective annual rate of interest paid/received on a sum of money after taking…

Q: 3. Find the annual percentage rate (APR), a.k.a. annual equivalent rate (AER), of interest of a…

A: Since you have posted multiple questions we shall be solving the first one for you. In case you wish…

Q: When compounded quarterly P12,000 becomes P 20,415.23 after 4 yrs. What is the nominal rate of…

A: Present value (PV) = P12000 Future value (FV) = P20,415.23 Period (t) = 4 Year Number of compounding…

Q: Suppose your principal investment is $1800 and you have a nominal interest rate of 6.5%. what is…

A: Given: Principal = $1800 Nominal Interest Rate = 6.5% Inflation = 2.7% Tax = 22%

Q: The bank is paying 6.68% compounded annually. The inflation is expected to be 15.22% per year. What…

A: Inflation is the increase in the general price levels. It reduces the purchasing power of money.

Q: A $1000 deposit in an account earns interest at an annual nominal rate of 8.00%. Interest is…

A: Using excel FV function

Q: Calculate and compare the effective rates of interest for saving accounts paying: (a.) a nominal…

A: Formula for computation of effective rates is as follows:Effective rates=1+rmn-1where,r=Interest…

Q: What interest comp. monthly is equivalent to an interest rate of 16.3% comp. quarterly?

A: First, we need to convert Quaterly compounded rate to Effective Annual Rate So, 16.3% Compounded…

Q: What is the effective interest rate per payment period for an interest rate of 12% compounded…

A: The effective rate per period is the rate per period when the nominal rate is compounded at a…

Q: he Mickey corporation has an annual profit before interest and tax of $19.6M, and an interest cost…

A: The interest coverage ratio indicates the efficiency of the business entity to pay out its interest…

Q: The present rate for deutsche marks per dollar is 1.79 and 90-day forward rate is 1.78. Compute the…

A: The annualized forward discount rate is the rate at which the forward price of a currency is less…

Q: present rate is 1.79 and 90 days forward is 1.78 . what is annualised discount rate ?

A: In this question we are given present rate i.e spot rate and 90 days forward rate and we are…

Balance Sheet Regulations

A balance sheet is a financial statement that shows the position of a company's assets and liabilities on a specific date. The balance sheet is prepared after preparing the statement of profit and loss statement (income statement). The balance sheet and other financial statements differ in the sense that the balance sheet shows the financial position at any given point in time. In contrast, the other financial statements show the financial performance over a particular duration.