ging 50 EFFECTIVE VERSUS NOMINAL INTEREST RATES Bank Aps unded anyone while Bank pa 35 cals Based on the EAR EFP which bank should you Cavour choice od bani ben d by the fact that you want to withdraw your hands during the year as opposed to As that you funds must be left on droit du compounding period in ceder e any interest 5-31 NOMINAL INTEREST RATE AND EXTENDING CREDIT As a manage you want to be credit with interest i bal puid monthly to carry recevables, you must borrow funds to bankat a monthly compounding. To offset your own you want to change your customers an EAR EFP%) that is than bebank hang you What APR we should you change yo 5-32 5.33 BUILDING CREDIT COST INTO PRICES Yourfum sells for cash only but it is thinking of oferi credit, allowing customer 90 days to pay. Customer understand the time value of money so they would all wait and pay on the day To Ga m ovables, you would have to borrow funds Loes your bank ata nominal 12 day compounding based on a 360-day You want to increase your base price by exactly enough to t ve bunk interest cost. To the closest whole percentage point by how much should you your product prices? REACHING A FINANCIAL GOAL Shan Chen and Shan Xia who are twins just moved 520.000 each for their 25 bithday. They both have aspira- to becomes . Each plans to SS000 annual bution to her early woment fund" on her birthday beginning aya from today Shan Chen opened an account with the Asian Regional Bond Fund, a mutual fund that invest in high-quality bonds whose i s tors have earned 6 per year in the past. Shan Xia invested in the First Renewable Tech Fund, which invests in small newly issued bio-tech stocks and whose investors have earned an average of 20 per year in the fund's relatively short history the two women's funds earn the same returns in the future as in the past, how old will each be when she becomes a millionaire b. How large would Shan Chen's anal contributions have to be for her to become a millionaire at the same age as Shan Xia ming their expected u s are realized? Is it rational or irrational for Shan Chen to invest in the band und rather than in stod 5-34 REQUIRED LUMP SUM PAYMENT Starting next year we will need mally for years to complete your education Crear from today you will withdraw the first to. Your uncle deput amount in bank paying a t which will provide the needed $10.000 payments How largo deposit be? How much will be in the co m mediately after you make the ging 50 EFFECTIVE VERSUS NOMINAL INTEREST RATES Bank Aps unded anyone while Bank pa 35 cals Based on the EAR EFP which bank should you Cavour choice od bani ben d by the fact that you want to withdraw your hands during the year as opposed to As that you funds must be left on droit du compounding period in ceder e any interest 5-31 NOMINAL INTEREST RATE AND EXTENDING CREDIT As a manage you want to be credit with interest i bal puid monthly to carry recevables, you must borrow funds to bankat a monthly compounding. To offset your own you want to change your customers an EAR EFP%) that is than bebank hang you What APR we should you change yo 5-32 5.33 BUILDING CREDIT COST INTO PRICES Yourfum sells for cash only but it is thinking of oferi credit, allowing customer 90 days to pay. Customer understand the time value of money so they would all wait and pay on the day To Ga m ovables, you would have to borrow funds Loes your bank ata nominal 12 day compounding based on a 360-day You want to increase your base price by exactly enough to t ve bunk interest cost. To the closest whole percentage point by how much should you your product prices? REACHING A FINANCIAL GOAL Shan Chen and Shan Xia who are twins just moved 520.000 each for their 25 bithday. They both have aspira- to becomes . Each plans to SS000 annual bution to her early woment fund" on her birthday beginning aya from today Shan Chen opened an account with the Asian Regional Bond Fund, a mutual fund that invest in high-quality bonds whose i s tors have earned 6 per year in the past. Shan Xia invested in the First Renewable Tech Fund, which invests in small newly issued bio-tech stocks and whose investors have earned an average of 20 per year in the fund's relatively short history the two women's funds earn the same returns in the future as in the past, how old will each be when she becomes a millionaire b. How large would Shan Chen's anal contributions have to be for her to become a millionaire at the same age as Shan Xia ming their expected u s are realized? Is it rational or irrational for Shan Chen to invest in the band und rather than in stod 5-34 REQUIRED LUMP SUM PAYMENT Starting next year we will need mally for years to complete your education Crear from today you will withdraw the first to. Your uncle deput amount in bank paying a t which will provide the needed $10.000 payments How largo deposit be? How much will be in the co m mediately after you make the