Table 92 -Refer to Table 9

question 87

Multiple Choice

Table 9.2
$$\begin{array} { | l c | } \hline \text { Cost of machine } & \$ 300,000 \\\hline \text { Arnual autput from mechine } & \$ 35,000 \\\hline \text { Arnual interett rate on loans } & 9 \% \\\hline\end{array}$$
-Refer to Table 9.2. If a firm purchases the machine by taking out a one-year loan, what is the firm's profit from the investment?

• A) $25,500
• B) $35,000
• C) $8,000
• D) $0
• E) $6,525

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Definitions:

Interest Rate

The percentage of a loan that comes with an interest charge to the borrower, often stated as an annual percentage of the loan balance.

Interest

The cost of borrowing money or the profit from lending it, typically expressed as an annual percentage of the principal.

Airline Ticket

An airline ticket is a document, typically electronic, that confirms a passenger’s reservation on a flight and includes details such as flight number, date, and seat assignment.

Savings

Money that is set aside or deposited, typically in a bank account, for future use or as a precaution against emergencies.