Would a dollar tomorrow be worth more to you today when the interest rate is 20% or 10%?

Q: What is a simple interest rate?

A: Interest is the cost of borrowing money, where the borrower pays a fee to the lender for the loan or…

Q: Robert wins $5,000,000 at the lottery; however, he is not going to receive the full prize…

A: To find the present value of future cash inflows, we discount the values of future cash inflows with…

Q: "You are interested in buying a piece of real property that could be worth $313,000 in 15 years.…

A: Here, we calculate the given as follow;

Q: People should buy bonds when they think that interest rates are as high as they will go.

A: A bond is a financial instrument that allows an issuer to raise capital by borrowing money from…

Q: How much money must you invest today in order to withdraw ₱ 11,331 annually for 5 years if the…

A: Given the information: Annual withdrawal amount = 11331 Time = 5 years Interest rate = 1.98%

Q: Determine the Future Value of a Lump Sum of Money

A: The future estimation of money is essential to organizations since it considers the expected rate of…

Q: A lottery claims its grand prize is $20 million, payable over four years at $4,000,000 per year. If…

A: We know that,  PV = FV / (1+r)n So, PV of all cash flow of this lottery is, PV = $4,000,000 /…

Q: Use the Rule of 72 to approximate how many years it will take money to double when growing at an…

A: Rule of 72 helps us to calculate the number of years it will take the money to double given the…

Q: Given an interest rate of 12%, how much does one need to invest today to acquire 5,000 pesos…

A: Given information, Interest rate (i): 12% Annual income (A): 5,000 pesos Time period (N): 20 years…

Q: Suppose you buy a big-screen TV with $1,000 down and $500 per year for the next two years. If the…

A: A person buy a big-screen TV with $1,000 down and $500 per year for the next two years. If the…

Q: How is the future related to the present value of a single sum?

A: The future value is that the sum of present value and also the total interest. the long run value…

Q: Assume an interest rate of 5%. What is the maximum amount an individual would be willing to give up…

A: Future value (F.V.) = $1 Interest rate (r) = 5% = 0.05% Number of years (n) = 30 years Present value…

Q: Write the two types of interest rates used in equivalence calculation rates?

A: The amount of interest received for an investment at the end of a year need to calculate its…

Q: Do the interest rates reflect the market interest rate?

A: An amount of money due per period as a proportion of the loan, deposit, or borrowing amount is…

Q: True or False: According to the Rule of 72, doubling time increases as interest rates increase. True…

A: Rule 72 refers to the quick formula that is properly used to calculate the number of years required…

Q: Hi! Can you help me with the question below? Matt has the choice between receiving $100 now or…

A: Matt has the choice between receiving $100 now or receiving $140 in two years. Simple interest…

Q: Why might an investor prefer to invest indirectly rather than directly?

A: Direct or indirect investment both leads to pay offs, it depends on the investor about what is…

Q: Explain time and interest rate effect on future value?

A: Interest rate: It is the rate of earning in a specific time period on the investment.

Q: If mortgage rates fell to 0 percent ("free money"), why might consumers still hesitate to borrow…

A: In general, the term mortgage rates refer to the interest rate charged by the financial institution…

Q: What might cause interest rates to be low one year and high the next?

A: Interest rates are best thought of as the "cost of money." If a borrower wishes to spend more money…

Q: What are the two types of interest rates used in equivalence calculations?

A: Equivalence calculation is the calculation of interest rate received for an investment at the end of…

Q: How could people be persuaded to start saving for retirement?

A: Retirement planning is the process of putting money aside, investing it, and then distributing it in…

Q: Why is investment is a better option other than savings?

A: The income remaining from the consumption expenditure is termed as the saving of the people. It can…

Q: what are the economic goals of a low-interest rate?

A: The presence of interest helps borrowers to spend money right away rather than waiting to save up…

Q: In how many years will an amount be doubled if the interest rate is 6%?

A: Interest rate can be defined as the percentage of the loaned amount a borrower is obliged to pay to…

Q: What is Tesla Inc. in 2018 all about?

A: Introduction Elon Musk, Tesla's Chairman and CEO, tweeted on August 7, 2018, that he was…

Q: f a coupon bond has two years to​ maturity, a coupon rate of 8​%, a par value of ​$1000​, and a…

A: Answer: Given, Coupon rate = 8% Par value = $1000 Yield to maturity = 12% Calculation:…

Q: You have two investments to choose from. Investment A pays an interest rate of 5% for 2 years and…

A: Future worth is a worth of a venture or resource on a particular date from now on. To put it another…

Q: Write the formula of Effective interest?

A:

Q: The discount rate will never be equal to interest rate. True or False?

A: Discount rate is defined as the rate of interest which is charged to commercial banks and other…

Q: what is high interest rates?

A: In an economy, interest rate is one of the economic term used at the marketplace when people make an…

Q: - Interest is paid because

A: To find : Why is interest paid.

Q: Suppose you wish to borrow $800 for four weeks and the amount of interest you must pay is $20 per…

A: The Annual Percentage Rate (APR) is the cost of borrowing money stated as a percentage each year,…

Q: Exercise 2.3 at pg24: Say you barrowed $10,000 from a bank at 12% interest rate per year for a…

A: a)10,000*10=1,00,000 Interest 12% 1200*10=12,000 Therefore 1,00,000+12,000=1,12,000

Q: The future value of a dollar as the interest rate increases and the longer the money remains…

A: The relationship between future value and the interest rate and time is positive i.e.. direct. It…

Q: How is an Effective Interest Rate calculated?

A: The effective rate of interest is an important concept in economics.  The effective rate of interest…

Q: You deposit $ 9,030 in an account that pays 3 % simple interest.  How much do you have after 4…

A: Simple interest: Interest is a quick and easy technique of calculating the interest charge on a…

Q: what are the economic goals of high-interest rate?

A: The interest rate is a proportion of the principal, which is the amount borrowed, that a lender…

Q: What does the interest rate measure?

A: Market interest rate refers to the interest rate that the lenders expect or demands from the…

Q: years from now at an interest rate of

A:

Q: What are objectives on interest rate spread

A: When talking about interest rate spread, it is considered as the difference in the interest rate…

Q: What is the present value of $100 one year from now if the interest rate is 10%? What is the present…

A: Interest rate: It refers to the rate at which the debtor has to pay the amount with the interest…