Suppose that your friend has a farm in 2019 and wants to make an investment 150,000 in 2030 for all farm requirements.  a) If you can earn 3.13% per year on your investments, how much does he need to invest today to achieve his goal?                                                      b) Between 2019 and 2025 how much would he have raised if the interest increased to 3.5%.                                                                                                   c) From question A calculate the future value for year one and year two.

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A: Here, Discount Rate is 10%

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A: Equity return will the difference in investment value initially and value at end (after 3 years).

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A: Solution:- Average annual compound rate means the average of the returns earned in the various…

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A: Annual return = ((P1 - P0)/P0)*100 Arthemetic average return = (Return1+.....+Return4)/100 Geometric…

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A: 1/10 net 30 means   discount = 1% total amount due = 30 days bill due = 10 days

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A: given  FV = 38140 n= 6y6m = 13  i= 9.5%

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A: B-C ratio is a cost-benefit analysis method used to select the best alternative out of many.…

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A: Solution:- Depreciation is the wear and tear cost of using an asset.

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A: Here,

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A: Present value is the value of money today that is to be received in future.

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Q: 1,356.95 2,618.83 5,237.66

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Cost of Credit

The cost of credit is an extra amount that the borrower has to pay besides the loan amount. These credit charges may vary from loan to loan. The cost of credit includes interest charges, maintenance charges, and arrangement charges. Some of the costs are mandatorily collected by the lender based on the loan amount and tenure of the loan. The cost of credit is also called finance charges of the credit.