Use the Actuarial Method to Find the Amount of Unearned

question 123

Multiple Choice

Use the actuarial method to find the amount of unearned interest for the loan paid in full before the due date.
-Amount Financed: $2500 Regular Monthly Payment: $55.61
Total Number of Payments scheduled: 60
Loan repaid in full instead of making: 36th payment

• A)$151.61
• B)$173.24
• C)$153.34
• D)$146.95

Identify and calculate the premium or discount on forward exchange contracts.

Understand how to account for and report monetary and non-monetary items in foreign currency transactions.

Recognize different financial instruments used for hedging foreign exchange risk such as currency swaps and forward contracts.

Grasp the use of exchange rates (historical rate, spot rate, closing rate) in foreign currency transactions and financial reporting.

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Definitions:

Output

The total amount of goods or services produced by a person, machine, business, or economy.

Prices

The sum of money anticipated, needed, or provided as payment for something.

Classical Dichotomy

The theoretical separation of nominal and real variables in the economy, suggesting that changes in the money supply only affect nominal variables and not real variables like output.

Monetary Neutrality

The economic theory suggesting that changes in the money supply only affect nominal variables and have no long-term effect on real variables such as output or employment.