You Need to Borrow $2,000 Quickly, and the Local Pawn

question 371

Multiple Choice

You need to borrow $2,000 quickly, and the local pawn shop will give it to you if you promise to repay them $200.92 monthly over the next year.

Suppose that the pawn shop's cost of funds is 12%, compounded monthly. From its viewpoint, what is the NPV of this deal?

• A) $44.11
• B) $111.01
• C) $226.17
• D) $261.37
• E) $292.01

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Definitions:

High-Performance Workplace

A work environment designed to maximize employee productivity, engagement, and satisfaction.

Employee Morale

Refers to the overall satisfaction, outlook, and feelings of well-being that employees feel about their workplace.

Deming

Refers to W. Edwards Deming, an American engineer, statistician, professor, author, lecturer, and management consultant known for his work in quality management and productivity improvement.

Quality Movement

A management approach focusing on continuous improvement of processes, products, and services to achieve superior quality and customer satisfaction.