User Account

All Pages

Which interest rate would be better for norman

Assignment Help Accounting Basics
Reference no: EM13505346

Norman is considering the purchase of some investment land from his neighbor, Robin, a high school math teacher. Robin purchased the land 10 years ago for $6,000. They have agreed on the overall terms of payment of $800 every month for the next three years for a total of $28,800. They have not agreed on how much of each payment is interest and how much is principal. Norman thought that a fair interest rate would be 8 percent with the rest of each payment allocated to principal. Robin, however, said that he wanted to ""give his neighbor a break"" and only have 4 percent designated as interest with the rest of each payment allocated to principal. What difference does it make to Norman and to Robin how much is allocated to interest versus principal if the total of the cash payments will not change? Which interest rate would be better for Norman?

Reference no: EM13505346

Questions Cloud

Define temperature the molecules of co2 would have a rms : At what temperature the molecules of CO2 would have a rms velocity equal to that of H2 molecules at 24 * C?
Explain the politics of the us drug war with regard : Explain the politics of the US drug war with regard to 1) political realignments, 2) civil liberties, and 3) civil rights. Your response should discuss current strategies employed to combat the drug war and relevant constitutional provisions.
Estimate the volume charge density of the atmosphere : In a particular region of the earth's atmosphere, Calculate the volume charge density of the atmosphere assuming it to be uniform between 258 and 402 m. Neglect the curvature of the earth
What are the tax implications of these two alternatives : Ricardo is a professional football player. In negotiating his contract for the upcoming season, Ricardo is given two options. He can receive (1) twelve monthly checks of $325,000 with no deferred payments.
Which interest rate would be better for norman : What difference does it make to Norman and to Robin how much is allocated to interest versus principal if the total of the cash payments will not change? Which interest rate would be better for Norman?
Evaluate the ph at the equivalence point in the titration : Calculate the pH at the equivalence point in the titration of 50 ml of 0.10 M methylamine with a 0.20 M HCl solution.
What are the additional requirements for grade gs-7 : What are the basic requirements to work for the IRS at level GS-5?
Explain volume of air is required if the air is introduced : Ammonia gas is produced by reacting hydrogen gas with nitrogen gas. To produce 450 g of ammonia gas using air as your source of nitrogen gas, what volume of air is required if the air is introduced at 25°C and 740 mmHg
Determine the electric flux through each of the sides : A 1.50- ?C charge is placed at the center of a cube of sides 3.10 cm. Determine the electric flux through each of the sides

Reviews

Write a Review

Accounting Basics Questions & Answers

  How much control does fed have over this longer real rate

Hubbard argues that the Fed can control the Fed funds rate, but the interest rate that is important for the economy is a longer-term real rate of interest.   How much control does the Fed have over this longer real rate?

  Coures:- fundamental accounting principles

Coures:- Fundamental Accounting Principles: - Explain the goals and uses of special journals.

  Accounting problems

Accounting problems,  Draw a detailed timeline incorporating the dividends, calculate    the exact Payback Period  b)   the discounted Payback Period. the IRR,  the NPV, the Profitability Index.

  Theory of interest - term structure of interest rates

Term Structure of Interest Rates

  Write a report on internal controls

Write a report on Internal Controls

  Prepare the bank reconciliation for company

Prepare the bank reconciliation for company.

  Cost-benefit analysis

Create a cost-benefit analysis to evaluate the project

  Theory of interest

Theory of Interest: NPV, IRR, Nominal and Real, Amortization, Sinking Fund, TWRR, DWRR

  Liquidity and profitability

Distinguish between liquidity and profitability.

  What is the expected risk premium on the portfolio

Your Corp, Inc. has a corporate tax rate of 35%. Please calculate their after tax cost of debt expressed as a percentage. Your Corp, Inc. has several outstanding bond issues all of which require semiannual interest payments.

  Simple interest and compound interest

Simple Interest, Compound interest, discount rate, force of interest, AV, PV

  Capm and venture capital

CAPM and Venture Capital

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!

Submit Assignment

Academics

Major Subjects

Majors

Get In Touch

whatsapp: +1-415-670-9521

Phone: +1-415-670-9521

Email: [email protected]

TERMS & POLICIES

HELP & SUPPORT

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