You Plan to Borrow $30,000 at a 7% Annual Interest

question 48

Multiple Choice

You plan to borrow $30,000 at a 7% annual interest rate.The terms require you to amortize the loan with six equal end-of-year payments.How much interest would you be paying in Year 2?

• A)$1,548.79
• B)$1,630.30
• C)$1,716.11
• D)$1,806.43

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Definitions:

Cash Surpluses

Refers to the amount of cash that exceeds the cash needed to fund immediate expenses and operational activities.

BAT Model

The Behavior, Attitude, Technique (BAT) Model is a framework used for improving sales effectiveness and training by focusing on the behavior, attitude, and techniques of sales personnel.

Fixed Cost

Expenses that do not change with the level of production or business activity, such as rent, salaries, and insurance premiums.

Opportunity Rate

The return a company foregoes by investing capital in one project over a potentially more profitable alternative.