Aproperty was purchased for $10,000.00 down and quarterly payments of $1,350 for 10 years. if the first payment was made on the date of the purchase and interest is 5.5 % compounded quarterly, a. what was the purchase price of the property? b. how much is the cost of financing? c. what is the effective rate of interest equivalent to a nominal rate of 5.5 % compounded quarterly?

cost of financing is $12108.62

interest is 5.614 %

Step-by-step explanation:

given data

payment = $10000

principal = $1350

time t = 10 year = 10 × 4 = 40

rate  r = 5.5 % = 5.4 /4 = 1.375 %

to find out

purchase price and cost of financing and rate of interest

solution

we know here purchase price is calculated as

purchase price = payment + present value    .................1

present value = principal (1+r) ( 1- / r )

put here value

present value = 1350 (1+0.1375) ( 1- / 0.01375 )

present value = 41891.3833

so from equation 1

purchase price = 10000 + 41891.3833

purchase price = $51891.38

and

so amount of payment is here

amount of payment = 10000 + 40×1350

amount of payment = $64000

so here cost of financing is here

cost of financing = 64000 - 51891.38

cost of financing = $12108.62

and

so here

1 + interest =

1 + interest =

interest = 0.0561448

interest = 5.614 %

answer:   x = 3 + √11     and     x = 3 - √11

step-by-step explanation:

x² - 6x + 9 = 11

(x - 3)² = 11

x - 3 = ±√11

    x = 3 ± √11

x = 3 + √11     and     x = 3 - √11

change of stock price/initial stock price on friday * total stock value = change of stock value

0.89/73.73 *x = 42.72

x=3539.04 = total stock value at initial stock price on friday .

total stock value at initial stock price on friday/ initial stock price on friday = number of shares

3539.04/73.73 = 48 shares

they own 48 shares of this stock