Use the Following Information to Answer the Question(s)below

question 64

Multiple Choice

Use the following information to answer the question(s) below.
Dagny Taggart has just purchased a home and taken out a $400,000 mortgage.The mortgage has a 30-year term with monthly payments and has an APR of 5.4%.
-The total amount of principal that Dagny will pay during the first month of her mortgage is closest to:

• A)$246.
• B)$446.
• C)$1800.
• D)$2245.

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Definitions:

Operating Cash Inflow

Funds that are generated from a company's normal business operations, reflecting the cash inflows from selling goods and services.

Working Capital

The difference between a company's current assets and its current liabilities, indicating the liquid assets available for day-to-day operations.

Straight-Line Depreciation

A way of allocating an asset's expenditure smoothly over its effective life.

After-Tax Discount Rate

The interest rate used in discounting cash flows that takes into account the tax implications of the investment.