A $60,000 Loan at 12% Compounded Semi-Annually Is to Be

question 104

Multiple Choice

A $60,000 loan at 12% compounded semi-annually is to be repaid by monthly payments of $1,000.
-How long will it take to pay off this loan?

• A) 7 years and 5 months
• B) 7 years and 6 months
• C) 7 years and 7 months
• D) 8 years and 3 months
• E) 8 years and 4 months

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Definitions:

Break-even

The point at which total revenues and total expenses are equal, resulting in no net loss or gain.

Monthly Dollar Sales

The total sales revenue earned by a business within a month, measured in dollars.

Variable Expenses

Costs that change in proportion to the activity of a business, such as sales or production levels.

Fixed Expenses

Costs that do not change in total despite fluctuations in the volume of goods or services produced or sold.