If Marjorie Wilcox Borrows $200 for One Year with an APR

question 87

Multiple Choice

If Marjorie Wilcox borrows $200 for one year with an APR of 12% and an annual service fee of $10,what is her total cost of credit?

• A)$10
• B)$12
• C)$24
• D)$34
• E)$42

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Definitions:

Income Tax Expense

The cost incurred by businesses and individuals due to earnings, computed based on tax rates and laws.

Capital Budgeting

The process of evaluating and selecting long-term investments that are in line with the goal of wealth maximization.

Straight-Line Depreciation

Straight-line depreciation is a method of allocating the cost of a tangible asset over its useful life in equal annual amounts.

Capital Budgeting

The strategy of organizing and overseeing a business's extended investments in ventures and assets.