Answer:
1) Luxury
2) Necessity
Explanation:
1)The hair tie is a luxury good for Mike because Mike has a income elasticity of 5 which means that if mike's income decreases 1% his demand for the good decreases 5%, which shows that his demand for this good is highly sensitive to his income which is a characteristic of luxury goods, as you only buy luxury goods when your income increases.
2) It is a necessity for Sally because her income elasticity to the good is 0.2 which means every 1% change in income changes her demand by just 0.2%, which shows demand is not very sensitive to income and the quantity she buys them in dont rely much on her income, which is a sign of a necessity, you buy a certain amount of necessities regardless of your income.
Answer:
depreciation expense per year 8,000
Explanation:
<u>The first step,</u> is to calculate the depreciable amount for the asset:
cost - salvage value = amount subject to depreciation
43,250 - 3,250 = 40,000 = depreciable amount
<u>Then,</u> we calculate the depreciation per year:
depreciable amount/ useful life = depreciation per year
40,000/5 = 8,000
In some particular cases, the first year the asset enter the accounting it could be for a period of half the accounting period, so only half-year depreciation is appliedon the first year.
Answer:
PV of annuity due = $90,182.8 (Approx.)
Explanation:
Given:
Payment per year = $12,000
Number of year = 10
Interest rate = 7% = 0.07
Find:
PV of annuity due
Computation:
PV of annuity due = P + P[{1-(1+r)⁻⁽ⁿ⁻¹)/r]
PV of annuity due = 12,000 + 12,000[{1-(1+0.07)⁻⁽¹⁰⁻¹)/0.07]
PV of annuity due = $90,182.8 (Approx.)
Answer:
Using an excel spreadsheet I prepared an amortization schedule. For the 61st payment, the interest rate is increased from 0.5% to 0.625% monthly.
(a) Calculate the loan balance immediately after the 84th payment.
(b) Calculate the amount of interest in the 84th payment.
(c) Calculate the amount of the balloon payment.
As you can see, the interest amount for the 61st payment increases, while it had been decreasing previously.
Answer:
C. Look for cars of bicycles on the traffic side of your vehicle.
Explanation:
Safety is always first, for you, and the people around you. To minimize risk of injury, you must check for oncoming cars or bikers.