Molly Borrows Money by Promising to Make a Single Payment $\bold{\text{(Use appropriate factor(s)from the tables provided.)}}$

question 63

Multiple Choice

Molly borrows money by promising to make a single payment of $100,000 at the end of 5 years.How much money is Molly able to borrow if the interest rate is 10%,compounded semiannually? (PV of $1,FV of $1,PVA of $1,and FVA of $1) $\bold{\text{(Use appropriate factor(s) from the tables provided.) }}$

• A)$38,550
• B)$78,350
• C)$62,090
• D)$74,850
• E)$61,390

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Definitions:

Variable Costs

Expenses that vary directly with the amount of activity or output in a company.

Financial Advantage

The benefit obtained by a business from its financial decisions and strategies.

Fixed Manufacturing Overhead

Costs related to manufacturing that do not change with the level of production, such as salaries of supervisors and rent for factory space.

Contribution Margin

The difference between sales revenue and variable costs of production, indicating how much revenue contributes towards covering fixed costs and generating profit.