gingko-inc-issued-bonds-with-a-face-value-of-100000-a-rate-of-7-and-a-10-yearterm-for-103000-from--2

Question

Gingko Inc. issued bonds with a face value of $\$100,000$, a rate of 7%, and a 10-yearterm for $\$103,000$. From this information, we know that the market rate of interest was ________.
A. more than 7%
B. less than 7%
C. equal to 7%
D. equal to 1.3%

Amy Jiang · Accepted Answer

Okay, so we have a bond with a face value of 10,000. So our formula for face value that is a is equal to P. Times one plus, Archie. Okay, so are face value. That is 10,000. And now our principle is at a rate of 5988.2 and then that&#x27;s for 10 years. So we ask yourself, All right, so we have 10,000 divided by 5988.2 Okay. And now was to track that by one and then divide by 10 and then we get a rates of 0.67 which is equal to 6.7%.

Liuxi Sun · Answer

let&#x27;s find the amount of $1000 investment into a bank account, where they&#x27;re 7% compound interest monthly. So every month we get 7% on top, some percent growth of the current balance of, um, in the bank account every year, so every month. So we have interest on top of the interest, and we&#x27;re doing this for 10 years. So the total amount after 10 years would be 1000 times one plus. So one stands for 100%. Because we&#x27;re keeping the total 100% balance. We&#x27;re not getting rid of it. So at the end of every period, and 0.7% is equal to 0.7 in decimal form were growing. So we&#x27;re taking or keeping the $1000 adding 0.7 of $1. Sounds help up. And we&#x27;re doing this every year. And since his monthly compound interest, we divided by the number the unit of times, a unit of, um, time for the month months in a year. So we had 12 and since we&#x27;re using once 10 years become 120 months because 12 times 10 so raise it to power of 120 we can plug this into a calculate. Now we got approximately 2000 and 9.66 and this is the total amount in the bank after compound interest of 7% monthly and after 10 years.

Laura Skalaski · Answer

going to deposit $900 into a 7% interest. Compounded yearly in the past. Bounds on the 10 years. Follow the exponential growth model. Why was see Time&#x27;s one plus I t power. So we&#x27;re gonna fill in C, which is our initial amount. It&#x27;s our deposit. $900 were you multiply that by one. Plus ours our growth rate, 7% interest. Gonna take that best more, move it to double left. That&#x27;s gonna give us a growth rate of 0.7 So one plus 0.7 gonna raise that two ton power because we find any balance at the end of years. So we were using. We have 900. We&#x27;re in a multiply that by one plus 0.0 of seven was Prentice used on race after the 10th power. This is money so round appropriately, $1770.44. So 17 70.40 or no, this is a path balance. At the end of 10 years

Raymond Luo · Answer

So our friend Reggie as $12,000 in total to invest in two different types of stocks. First, stock, you have 7% annual interest in the second star Kip. Listen, people in 5% annual interest. No. What this means is not supposed that for X amount invested in stock one, the annual payout from Stock one is Southern percent of acts. 7% times acts is the pay out of stock. Since that there is $12,000 in total that we&#x27;re investing it remaining allocation is 12,000 minus X dollars in stock, too. And what this means is that annual payout from stock, too, is the product 7%. Thanks. Uh, sorry. There&#x27;s a 0.5% times 12,000 minus acts. Now, the key to this question is we realized we want to find the total annualized payment payout to be $900 and this some of the annual payout from stock one and stuff, too. So we just take terms. We have written down 0.7 times X clothes, A 0.85 times, 12,000 minus X equals 10 900. Since there&#x27;s one variable here, we do the usual trick of grouping like terms to get 0.15 Thanks. Equals two. Um, this is 12,000 times your 0.0. You&#x27;re fired. 900 minus 12,000 times airplanes, right. Five with a calculator. Work. Get at the second term here 1000 times their 10000.85 news approximately 1060 which is gives his negative 160 on the straight side. Oh, no, sir, this is 1 20 So, in order. So for X, the pipe besides plays negative 0.515 We get 1 25 0 boys room five. Ah, with a calculator begin verify that this is $8000. And then we know that 12,000 once X there&#x27;s $4000. And these are how this is the distribution of allocation of the money between stock one and stock too

Amy Jiang · Answer

Okay, So this time we want to invest 12,000 now, which is a principle. That&#x27;s cool. Yeah. On. We wanted to grow to 20,000 in seven years. That&#x27;s two u seven. I know we went to this find or interest rate so it would start by the fighting 20,000 by 12,000. What? I know we&#x27;ll take the natural log of both sides. That gives us the natural log of 20,000. Over 12,000 is equal to seven or so already within the natural log of 20,000 over 12,000 all over seven. Let&#x27;s focus into my chocolate. So this is equal to 0.73 This is approximately 7.3 cents for our interest rate.

Problem 19 Easy Difficulty

Gingko Inc. issued bonds with a face value of $\$100,000$, a rate of 7%, and a 10-yearterm for $\$103,000$. From this information, we know that the market rate of interest was ________.
A. more than 7%
B. less than 7%
C. equal to 7%
D. equal to 1.3%

Answer

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Principles of Accounting Volume 1: Financial Accounting

Mitchell Franklin, Patty Graybeal, Dixon CooperPrinciples of Accounting Volume 1: Financial Accounting

Mitchell Franklin, Patty Graybeal, Dixon Cooper

Principles of Accounting Volume 1: Financial Accounting