Explain compensated for the loss in purchasing power, Operation Management

Assignment Help:

Fourteen years ago, the U.S. Aluminium Corporation borrowed $9.9 million. Since then, cumulative inflation has been 98 percent (a compound rate of approximately 5 percent per year). a. When the firm repays the original $9.9 million loan this year, what will be the effective purchasing power of the $9.9 million? (Hint: Divide the loan amount by one plus cumulative inflation.) b. To maintain the original $9.9 million purchasing power, how much should the lender be repaid? (Hint: Multiply the loan amount by one plus cumulative inflation.) c. If the lender knows he will receive $9.9 million in payment after 14 years, how might he be compensated for the loss in purchasing power? A descriptive answer is acceptable


Related Discussions:- Explain compensated for the loss in purchasing power

Explain rules of the irs and department of labor, Rules of the IRS and depa...

Rules of the IRS and department of labor determine which workers quailfy as indenpendent contractor?

Explain supply process improvements, Supply Process Improvements examine...

Supply Process Improvements examine the steps of the supply process in Chapter 4 of the text and identify a project where improvements could be made in one or more of the steps.

Explain what are the activities required to produce, What are the outputs o...

What are the outputs of your work unit if you are a manager at a fast-food restaurant? What are the activities required to produce those outputs? What are the inputs?

Explain widespread problem in industry, In light of today's high standard o...

In light of today's high standard of living, why do you think that employee theft is such a widespread problem in industry?

Line balancing, What happens if balance doesn''t exist

What happens if balance doesn''t exist

Supply, Introduction about law of supply

Introduction about law of supply

When manager focus the progress of an affirmative action, when manager moni...

when manager monitors the progress of an affirmative action program to advance minorities within the corporation; reviewing progress on changing in staff attitude; calls a special

How to use the virtual organization link on the student, Resources: Univers...

Resources: University Library, Kudler Fine Foods Virtual Organization Use the Virtual Organization link on the student website to access additional company information on Kudler

Explain database systems design implementation management, It says that the...

It says that there is guided sulotions available for Database Systems Design Implementation Management i bought the Ebook but i cant find it, can someone tell me where i can find t

Explain statutory law, Statutory law is: Answer a law enacted by a legislat...

Statutory law is: Answer a law enacted by a legislative body also known as the fundamental law of the nation a form of common law the separation of powers at the federal level all

Write Your Message!

Captcha
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