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1)Find the interest rate (or rates of return) in the following situation: You borrow $9,000 and promise to make payments of $2,684.80 at the end of...

This question was answered on Jan 17, 2013. View the Answer
1)Find the interest rate (or rates of return) in the following situation:
You borrow $9,000 and promise to make payments of $2,684.80 at the end of each of the next 5 years.

2)Set up an amortization schedule for a $25,000 loan to be repaid in equal installments at the end of each of the next 5 years. This interest rate is 10%.

3)Sales for Hanebury Corporation's just-ended year were $12 million. Sales were $6 million 5 years earlier.
a) at rate did sales grow
b)Suppose someone calculated the sales growth for Hanebury in part a as follows: “Sales doubled in 5 years. This represents a growth of 100% in 5 years; dividing 100% by 5 results in an estimated growth rate of 20% per year.” Explain what is wrong with this calculation
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Dear student Please find... View the full answer

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1. Solution
Borrowed Amount = $ 9000.00
Payment to be made every year = $ 2684.80
Now we have to calculate such rate so that present value of all the payments becomes
equal to
$ 9000.00
This is...

This question was asked on Jan 14, 2013 and answered on Jan 17, 2013.

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