Based on the amount of interest to be paid

Assignment Help Business Economics
Reference no: EM132410937

P1) Cost of Bank loan: The floral Boutique approached two banks to obtain a $10,000 bank loan. Bank "A" will give a 120 day loan at an annual interest rate of 12% and Bank "B" will give a 90 day loan at 15% ( note: Assume a 365 day year)

a) Based on the amount of interest to be paid, which bank loan should the floral Boutique choose?

b) Compare the 120 day and 90 day rates on the loans by finding the effective annual rate for each loan. Assume each loan is rolled over throughout the year under the same terms and circumstances.

c) Based on the effective annual rate for each loan, which bank loan should the floral Boutique choose?

P2) Spontaneous sources of funds, accruals: After consultation with its employees, Sunshine company decides to switch the employee pay period to biweekly instead of weekly. Sunshine weekly payroll is $925,000. The annual cost of funds is 12%. Will it be beneficial for Sunshine Company to change the pay period? Explain your answer?

Reference no: EM132410937

Questions Cloud

Is naira under-valued or over-valued against the cedi : The actual spot exchange rates for the Nigerian naira (N) and the Kenyan shilling (K$) are respectively N80/GHS and K$25/GHS.
Spot and forward bid-ask rates for the south african : Suppose the spot and forward bid-ask rates for the South African rand/Ghana cedi (ZAR/GHS) exchange rate at a particular today are as follows:
Calculate the forward duration of the ctd : Find the actual March 2020 Treasury Bond price and the appropriate conversion factor to calculate the forward duration of the CTD and the exact futures position
Estimate firm equity beta : Assume that taxes are not relevant. Please estimate our firm's equity beta.
Based on the amount of interest to be paid : a) Based on the amount of interest to be paid, which bank loan should the floral Boutique choose?
Company propose for the funds raised by the ipo : What does this company do? What purpose does the company propose for the funds raised by the IPO?
The misconceptions of sign language : The misconceptions of sign language. Some people believe sign language is based on English. When did it become considered a language?
Demonstrate the principles of love languages : To demonstrate the principles of love languages and effective use of interpersonal communication skills through "gifting" a close interpersonal relationship.
Discrete-Event Simulation of a Random Early Detection : EE509 Assignment - Discrete-Event Simulation of Random Early Detection Congestion Avoidance Scheme. Modelling a Queue with No Loss - Simple Queue Simulator

Reviews

Write a Review

Business Economics Questions & Answers

  Economics assignment

This document contains various important questions and their appropriate answers in the subject field of Economics.

  Demand and supply curves

Economics is the study of the principles governing the allocation of scarce means among competing ends when the objective of the allocation is to maximize the attainment of the ends.

  Long-run perfectly competitive equilibrium for the firm

Evaluate Government intervene and correct this situation?(a) Explain the concept of a concentration ratio. A rise in the price of magarine Explain the impact of external costs and external benefits on resource allocation long-run perfectly c..

  Supply and demand diagrams

Explain each of the following using supply and demand diagrams,  With the use of a graph, explain how these two programs affect cigarette consumption and the price of cigarettes.

  Case study: fisher-price toys

The case study of the Fisher-Price Toys, Inc., a popular case in basic economics and management from the prestigious Harvard Business School.

  Draw the production possibility curve

Draw the production possibility curve and a. Define consumer surplus and producer surplus.

  Tax revenue

The Australian government administers two programs that affect the market for cigarettes

  Maximize total welfare

How many tickets to sell to maximize total welfare.

  Difference between the cv and the ev

The change in consumer surplus (?CS) is not "theoretically" justifiable like the CV and EV but it continues to be the most widely used measure of consumer welfare change. Explain how this can be reconciled

  Depict von neumann-morgenstern utility index u in a diagram

Depict the von Neumann-Morgenstern utility index u in a diagram

  What is the market solution

What is the market solution (market price and quantity) and What is the total surplus of the society under the market solution

  Calculate gross national product and net national product

Calculate gross national product and net national product

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd