How much will jamie pay in interest

Assignment Help Microeconomics
Reference no: EM131916161

Problem

Jamie is saving for a trip to Europe. She has an existing savings account that earns 2 percent interest and has a current balance of $4,500. Jamie doesn't want to use her current savings for vacation, so she decides to borrow the $1,500 she needs for travel expenses. She will repay the loan in exactly one year. The annual interest rate is 5 percent.

a. If Jamie were to withdraw the $1,500 from her savings account to finance the trip, how much interest would she forgo?

b. If Jamie borrows the $1,500, how much will she pay in interest?

c. How much does the trip cost her if she borrows rather than dips into her savings?

Reference no: EM131916161

Questions Cloud

Why strategic behavior required to win presidential election : Why is strategic behavior required to win a presidential election? Describe some of the rules, strategies, and payoffs that define this game in the real world.
What will be the balance in your savings account in one year : You put the full $200 into your savings account, what will be the balance in your savings account in one year, assuming you make no additional deposits.
Would you agree that computerized corporate planning models : .Certain liability and net worth items generally increase spontaneously with increases in sales.
External audits are precisely the same as internal audits : In today's age of social media, organizations include resources such as YouTube and Twitter as part of their crisis management tool kit. true or false ?
How much will jamie pay in interest : If Jamie borrows the $1,500, how much will she pay in interest? How much does the trip cost her if she borrows rather than dips into her savings?
What is the minimum income required : Mr. and Mrs. Young are considering the purchase of a $250,000 property. What is the minimum income required? rounded to nearest dollar.
What is the opportunity cost of choosing to keep the ipod : What was the opportunity cost of acquiring the iPod? What is the opportunity cost of choosing to keep the iPod?
How much would you have to enjoy the next bowling game : Based on this information, how much would you have to enjoy the next bowling game, expressed in terms of dollars, to play another game?
What is the current price for that same bond : What is the current price for that same bond if the coupon rate were 7.5 percent and the yield to maturity were 4.68 percent?

Reviews

Write a Review

Microeconomics Questions & Answers

  Using the law of demand do you forecast that demand will

southwest airlines is adding 100 million a year in new fees. under new rules customers only get a partial refund for

  Describe expected environmental effect of increasing mpg

Serious criticism has been lodged against the CAFE standards because U.S. automakers res- ponded by using more plastics in automobiles (to make the cars lighter in weight) to meet the more restrictive CAFE standards.

  Determining market situation

Describe a market situation in which the operating company faces economic difficulties and need to cut costs. What cost cutting strategies may the operating company employ to remain profitable?

  Difference between a normal good and an inferior good

How are the laws of supply and demand illustrated in graph and what is the equilibrium price and quantity in this market?

  What are the impressions of proposals

What is the difference between GDP and GNP? Use the internet to find the numbers for US GDP and US GNP for the year 2016? Make sure you state the source.

  Average annual rate will produce result-investment growths

An investment growths from $1500 to $3500 over a period of five years. What average annual rate (%) will produce this result?

  Questiona let the utility function be u logx - l where l

questiona let the utility function be u logx - l where l is labour and x is consumption. find the level of labour

  Please show all the necessary calculations and explanation

Please show all the necessary calculations and explanations that lead to your answer. Provide your answers in the order the problems are given.1. Suppose Niki has the following demand functions: xi (p1, p2, m) = m = 2/pi;

  Maintenance management strategy for the next five years

The first task is to develop an outline asset maintenance policy for the case project. This should recommend suitable maintenance management strategy for the next five years.

  What happens when your income increases

Name a good you consume for which your income elasticity of demand is negative. What happens when your income increases?

  Why is an oligopolist more likely to be able to earn profit

Why is an oligopolist more likely to be able to earn a profit in the long run compared to a monopolistic competitive firm?

  Learnt in the course aggregate demand is equal

As we have learnt in the course aggregate demand is equal to C+I+G+(EX-IM) where the only difference with RGDP is that in the above equation I does not include accumulated inventories.

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd