Carmen’s Beauty Salon has estimated monthly financing requirements for the next six months as follows: January $ 9,000 April $ 9,000 February 3,000 May 10,000 March 4,000 June 5,000 Short-term financing will be utilized for the next six months. Projected annual interest rates are: January 9.0% April 16.0% February 10.0% May 12.0% March 13.0% June 12.0% a. Compute total dollar interest payments for the six months. Note: Round your monthly interest rate to 2 decimal places when expressed as a percent. Round your interest payments to the nearest whole cent. b-1. Compute the total dollar interest payments if long-term financing at 12 percent had been utilized throughout the six months? Note: Round your monthly interest rate to 2 decimal places when expressed as a percent. Round your interest payments to the nearest whole cent. b-2. If long-term financing at 12 percent had been utilized throughout the six months, would the total-dollar interest payments be larger or smaller than with the short-term financing plan? multiple choice Smaller Larger
Carmen’s Beauty Salon has estimated monthly financing requirements for the next six months as follows:
| January | $ 9,000 | April | $ 9,000 |
| February | 3,000 | May | 10,000 |
| March | 4,000 | June | 5,000 |
Short-term financing will be utilized for the next six months. Projected annual interest rates are:
| January | 9.0% | April | 16.0% |
| February | 10.0% | May | 12.0% |
| March | 13.0% | June | 12.0% |
a. Compute total dollar interest payments for the six months.
Note: Round your monthly interest rate to 2 decimal places when expressed as a percent. Round your interest payments to the nearest whole cent.
b-1. Compute the total dollar interest payments if long-term financing at 12 percent had been utilized throughout the six months?
Note: Round your monthly interest rate to 2 decimal places when expressed as a percent. Round your interest payments to the nearest whole cent.
b-2. If long-term financing at 12 percent had been utilized throughout the six months, would the total-dollar interest payments be larger or smaller than with the short-term financing plan?
multiple choice
-
Smaller
-
Larger
Trending now
This is a popular solution!
Step by step
Solved in 2 steps with 2 images
