1.13 RKI Instruments borrowed $4,800,000 from a private equity firm for expansion of its facility for manufacturing carbon monoxide monitors. The company repaid the loan after 1 year with a single payment of $5,184,000. What was the interest rate on the loan?

1.13 RKI Instruments borrowed $4,800,000 from a private equity firm for expansion of its facility for manufacturing carbon monoxide monitors. The company repaid the loan after 1 year with a single payment of $5,184,000. What was the interest rate on the loan?

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

See similar textbooks

Related questions

Q: QUESTION 2 a) Assume that you borrow $30,000 to purchase a new automobile and…

A: Given; Amount borrowed= $30000 Interest rate; r= 4% Time period; n= 4 years

Q: Leon and Heidi decided to invest $32500 annually for only the first nine years of their marriage.…

A: An interest rate is the amount of interest due per period, as a proportion of the amount lent,…

Q: Your visa card charges 1 % interest every month, what are the nominal and effective interest rates…

A: The nominal interest rate per year can be calculated as follows: Thus, the nominal interest rate is…

Q: ou decided to go and apply for a credit card at your local financial institution. The Prime rate…

A: Prime rate : The interest rate that banks charge their most creditworthy customers . It serves as…

Q: If you give $1000 as a deposit for rent and it accumulates at 4% simple interest, how much money in…

A: $1000 is as deposit or securities for rent and it earns 4% simple interest . As long as tenant pay…

Q: College Financial Sources, which makes small loans to college students, offers to lend $500. The…

A: Given: P=500 A=40 n=16 i=?

Q: You deposit $10,000 in a fund that pays compound annual interest equal to 3%. One year later the…

A: The nominal rate of interest which depicts the time value of money can be any declared interest…

Q: If a bank says that it has a 5% nominal interest rate, but money is compounded monthly in that bank,…

A: An effective annual interest rate is basically the actual return on a savings account or on any…

Q: A bank is offering a loan of $10,000 with a nominal interest rate of 6% compounded monthly, payable…

A: The nominal interest rate can be any declared rate of interest. The effective rate of interest is…

Q: You invest $5,000 per year at 8% nominal interest compounded quarterly. What is the future value…

A: Compound Interest is the interest calculated on the initial principal and also on the accumulated…

Q: 9 A farmer in a rural community in Iowa wanted to make an investment that would accumulate to…

A: Present value is the value of investment in today's dollar. Future value is the value of investment…

Q: You purchase a car today using a loan of $19000o APR 6%. plan is to pay during 5 years with equal…

Q: Using the data given below, select the equation that will correctly calculate the future value of…

A: Dear student, kindly check the answer in the explanation box below.Explanation:Dear student, kindly…

Q: To purchase $14,700 worth of machinery for her business, Ivanna made a down payment of $1700 and…

A: A sort of funding called a business loan is given to companies or entrepreneurs to help with…

Q: You purchased a winning ticket for a $5 million lottery which pays $500,000 immediately and the rest…

A: Here in this question, To decide whether we have to go with the deal or not. We have to find the…

Q: Table 14-1: Monthly Payments to Amortize Principal and Interest per $1,000 Financed Monthly Payments…

A: Monthly PITI (Principal, interest, tax , insurance) = monthly PI + Monthly tax + monthly insurance…

Q: A 3-month $28,000 treasury bill with a simple annual discount rate of 0.27% was sold in 2016. Assume…

A: Treasury bill:Duration = 3 monthsFace value = $28,000Simple annual discount rate = 0.27%Year = 2016…

Q: Compute the number of years (t) if future value (FV) = $13514, present value (FV) = $1186, and…

A: The formula for calculating the present value from the future value is :- PV = FV / ( 1+i)t

Q: Calculate the monthly mortgage payment with the following conditions: $515,000 borrowed, 3.15%…

A: According to question the total amount borrowed for the mortgages is $515,000, with the interest…

Q: 500 is invested in an account each month. nonthly, what is the account balance after 3

A: Compound interest is used to calculate loan or deposited amount. Given that, Starting amount is…

Q: A man made a loan of $100 to be repaid with $105 at the end of one month. What was the annual…

A: Simple interest refers to the interest which is charged upon a loan. This is the most simplest…

Q: 12% per year ( Annual Percentage Rate). It is charging the interest rate that is daily compounding.

A: The annual rate of interest= 12%=0.12 The daily rate of interest= 0.12/365=0.000328% number of…

Q: How much must be invested now at 6% simple interest to accumulate $1,000 at the end of 5 years?…

A: Information extracted in the question: Simple interest = 6% Future value = $1000 Time = 5 years

Q: What is the total cost of interest?

A: Total cost of interest = (monthly MorTgage Payment x Year x 12) -(Loan Amount ) Monthly Mortgage…

Q: Calculate the finance charge on a home equity loan based on an average daily balance of $97,552…

A: Interest rate is the cost of borrowing or the return on lending money. It represents the percentage…

Q: Compound Interest. Determine the future value of $700 which is invested at 10% interest which is…

A: Introduction: Given the present value = $700 Interest rate = 10% Time period = 8 years

Q: Maula-pae Weaks urgently needed $100,000 to pay lawyer-fees after illegally withdrawing a letter,…

A: Amount of Loan = 100,000 i = 15% n = 3 years Compounding is monthly To solve find the remaining…

Q: Picabo borrows $1000. To repay the amount, she makes 12 equal monthly payments of $93.12. Determine…

A: The annual percentage rate (APR) is a direct measure that includes nominal interest rates and fees…

Q: Given a loan for $58,000.00 at an interest rate of 16.15% for 5 years, determine your annual payment…

A: The objective of this task is to determine the annual payment amount for a loan of $58,000.00 with a…

Q: bank lends $3000 to be paid at the year 4 of the amount of $4500; what is the interest rate?

A: An interest rate is the amount of interest due per period, as a proportion of the amount lent,…

Q: car loan at an interest rate of 9% compounded monthly to be repaid over 60 months, where 9% is the…

Q: Fir a $5,000 loan repayment over 2 years at 12%. Find the monthly payment

A: Introduction: The loan amount is $5000 which has to repay in 2 years by making monthly payments.…

Q: What is the present value of a series of payments that grow by 10% per year over 5 years. The…

A: A geometric gradient series refers to a series of cash flow series that either rise or fall by a…

Q: How much money is in the account now

A: The formula for calculating the simple interest involves multiplying the principal (P) which is the…

Question

1.13
RKI Instruments borrowed $4,800,000
from a private equity firm for expansion
of its facility for manufacturing carbon
monoxide monitors. The company
repaid the loan after 1 year with a single
payment of $5,184,000. What was the
interest rate on the loan?

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

This is a popular solution!

SEE SOLUTION Check out a sample Q&A here

Step 1

VIEW

Step 2

VIEW

Trending now

This is a popular solution!

Step by step

Solved in 2 steps with 1 images

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, economics and related others by exploring similar questions and additional content below.

Similar questions

Which of the following is a cash outflow? Current year Last year Question 6 options: bank loan 2,000 1,000 mortgage payable 30,000 25,000 car 30,000 5,000 house 140,000 150,000
(6) A loan of $20,000 is to be repaid in uniform monthly payments over 3 years. If the interest in 9% per year compounded monthly, what is the amount of unpaid las principal after 24 monthly payments?
Suppose you take out a car loan of $15,000 with an interest rate of 15% compounded monthly. You will pay off the loan over 36 months with equal monthly payments.(a) What is the monthly interest rate?(b) What is the amount of the equal monthly payment?(c) What is the interest payment for the 15th payment?(d) What is the total interest paid over the life of the loan?
You borrow $2,000 from Gougo’s, a well-known loan consolidation outfit. The loan is an “unbelievably low” 2.5% per month compounded monthly. You have 2 years to pay back the loan. a. What is the nominal interest rate? b. What is the effective interest rate? c. If you wait until the end of year 2 to pay it off in one lump sum, how much must you pay? Use the “period interest rate” approach. d. If you wait until the end of year 2 to pay it off in one lump sum, how much must you pay? Use the “effective interest rate” approach. e. Of your payment in parts (c) or (d), how much is interest? f. Suppose you make equal end-of-month payments. How much is the monthly amount?
Subject: Engineering Economy What uniform amount is needed to exhaust a loan of 20, 000 dollars at 10% compounded annually for 5years? Please show solution
Tim invested in a 3-year bond paying 4.7% simple interest. Upon maturity the bond was worth $2700. How much money did Tom invest?
A trader buys a $1600, 12% quarterly bond for $1800, the bond matures in 3 years and pays interest compounded quarterly, what is the rate of return on the bond compounded quarterly?
If you borrow $14000 now at 10% interest for 7 years, what is the total accumulated compound interest owed at the end of year 7?
) You borrowed $5,000.00 at 2% per month and agreed to repay in equal monthly payments over the next 2 years. What is your monthly payment?
Richard Miyashiro purchased a condominium and obtained a 20- year loan of $192, 000 at an annual interest rate of 8.20%. (Round your answers to the nearest cent.)(a) What is the mortgage payment? (b) What is the total of the payments over the life of the loan? (c) Find the amount of interest paid on the mortgage loan over the 20 years.
Q3. A loan of $15,000 requires monthly payments of $477 over a 36-month period of time. These payments include both principal and interest. (a) What is the nominal interest rate (APR) for this loan? per year, compounded monthly (b) What is the effective interest rate per year? per year