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 total quality improvement organizational downsizing, Analyze how ea...

Analyze how each has changed healthcare delivery on both the macro and micro levels. Provide specific examples of how both macro and micro impacts/changes: Total quality improvemen

Explain and analyze klimptons strategy, Analyze Klimptons strategy for bein...

Analyze Klimptons strategy for being environmentally friendly. Determine how this strategy helps Klimpton make supplier channel decisions and manage the waste from its hotel and re

Explain probabilities of various caseloads to be unreliable, The director o...

The director of social services of a county has learned that the state has mandated additional information requirements. This will place an additional burden on the agency. The dir

Long term capacity expansion, Long term Capacity Expansion For the purpo...

Long term Capacity Expansion For the purpose of expansion of the long term capacity of the term the firm may decide to adapt and one more of the followings. 1.The firm may give

Explain changing the manufacturing process, Your company makes baby seats f...

Your company makes baby seats for cars and RVs. Your main product was designed some time ago, and new and better engineering data are available, but your product has a good record

Explain which option is more economical, A company is the logistics vendor ...

A company is the logistics vendor for B Company. B has daily shipments of a power-steering pump from its Ohio plant to an auto assembly line in Alabama. The value of the standard s

What are few strategies that you might in order to achieve, Suppose you are...

Suppose you are the CEO of a growing fast food company, specializing in hamburgers. You are interested in expanding your business into new domains. What are some strategies that yo

Explain what could go wrong as a result, Imagine the worst possible reports...

Imagine the worst possible reports from a system. What is wrong with them? List as many problems as you can. What are the consequences of such reports? What could go wrong as a res

Explain implement each function of management, Can someone PLEASE help get ...

Can someone PLEASE help get me started... Theories of management originated in the early 1900's. They have influenced how we view management today. By Wednesday, February 20, 2013,

Explain what are some of the positive and negative impacts, What are some o...

What are some of the positive and negative impacts of federally mandated socioeconomic programs, goals, and quotas within the federal government contracting process?

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