Carmens Beauty Salon has estimated monthly financing requirements for the next s
ID: 2705053 • Letter: C
Question
Carmens Beauty Salon has estimated monthly financing requirements for the next six months as follows:
Short-term financing will be utilized for the next six months. Projected annual interest rates are:
What long-term interest rate would represent a break-even point between using short-term financing and long-term financing? (Round intermediate calculations and final answer to 2 decimal places. Omit the "%" sign in your response.)
Carmens Beauty Salon has estimated monthly financing requirements for the next six months as follows:
Explanation / Answer
Payment =PV(i/n)/[1 - [[1 /1+ i/n]]^t*n] t=years, n= times per year
P=100000(.06/12)/[1-[[1/1+0.06/12]^15*...
100000(.005)/[1-[[.99502]^180]]
500/[1-.40748]
pmnt=843.86