Statement related to interest rates

Assignment Help Financial Management

Reference no: EM131921529

1. Tobin's Barbeque has a bank loan at 9% interest and an after-tax cost of debt of 5%. What will the after-tax cost of debt be when the loan is due if a new loan is taken out yielding 11%. (Do not round intermediate calculations. Round your answer to 2 decimal places.)

6.11%, 11.16%, 3.56%, OR none of these

2. Which of the following statement related to interest rates is correct?

A. Annual interest rates consider the effect of interest earned on reinvested interest payments.

B. When comparing loans, you should compare the effective annual rates.

C. Lenders are required by law to disclose the annual interest rate of a loan to prospective borrowers.

D. Annual and effective interest rates are equal when interest is compounded monthly.

Reference no: EM131921529

Questions Cloud

Theoretical price of the one-year at-the-money put price : What is the theoretical price of the 1-year at-the-money put price?

What is the effective annual rate if bank charges : What is the effective annual rate if a bank charges you 9.50 percent compounded quarterly?

Calculate the net present value-internal rate of return : calculate The net present value, The internal rate of return, The cash payback period.

Write three paragraphs of why data lakes be useful : Write three paragraphs of why Data Lakes (would / would not) be useful in your organization, and why?

Statement related to interest rates : Which of the following statement related to interest rates is correct?

Identify the various consumer decision processes : Identify the various consumer decision processes for the Target Corporation customer? How will you establish the market research for making better decision.

Identify events that led to the creation of the document : In this assignment, you are to write a three-page paper explaining the history, structure, and purpose of the U.S. Constitution.

In your own words what is the constitution : How would you characterize the overall position of perspective of the current United States Supreme Court (USSC)?

What specific issues did the coder address : What specific issues did the coder address that you can use in your own coding?

User Account

All Pages