8. Phoebe realizes that she has charged too much on her credit card and has racked up $7,000 in debt. If she can pay $200 each month and the card charges 17 percent APR (compounded monthly), how long will it take her to pay off the debt?

Q: What is meant by risk? Why must it be managed properly?

A: Risk can be defined as the probability of an event occurring and having consequences. Standard…

Q: What is meant by the term antidilution? Give an example.

A: An increase in the earnings per share refers to anti-dilution. This results on account of the…

Q: State the criticism of MM approach.

A: The Markowitz Model (MM), developed by Harry Markowitz in 1952, is a mathematical model that seeks…

Q: You are a consultant to a large manufacturing corporation considering a project with the following…

A: NPV is the capital budgeting tool that can be used for determining the feasibility of investment…

Q: What rules or policies should be developed to avoid the ethical problem?

A: Ethical problems: These kinds of problems arise when while making decisions neither of the options…

Q: What is a reasonableness test?

A: Reasonableness tests is an analytical procedure used to examine the validity of the accounting…

Q: Give the meaning of Trust.

A: Beneficiary/ Fiduciary Trustee  A trust has a beneficiary and a trustee. The individual who is the…

Q: Citing an example, distinguish between ethical issues and legal issues.

A: Distinguish between ethical issues and legal issues. Ethics are moral obligations that are…

Q: Highlight concept of faithful representation and is it valid or not?

A: The concept of Faithful representation advocates that the financial statements and information…

Q: What makes information irrelevant to decision making?

A: Irrelevant information is a part of the information collected for decision-making from various…

Q: Explain the specific relationship between risk and reward and why this relationship must be true.

A: Risk refers to probability for loss of investment value by an investor whereas Reward refers to…

Q: Explain the steps that apply your own sense of right and wrong to ethical dilemmas.

A: Ethics is an internal mechanism of an individual which can be applied to various situations to…

Q: A Framework for decision making: a. can help reduce the unexpected consequences of our actions. b.…

A: a. can help reduce the unexpected consequences of our actions. Here's why:Decision-making frameworks…

Cost of Credit

The cost of credit is an extra amount that the borrower has to pay besides the loan amount. These credit charges may vary from loan to loan. The cost of credit includes interest charges, maintenance charges, and arrangement charges. Some of the costs are mandatorily collected by the lender based on the loan amount and tenure of the loan. The cost of credit is also called finance charges of the credit.