BUSINESS HIGH SCHOOL

A finance company has a total of $20 million earmarked for homeowner and auto loans. On the average, homeowner loans have a 10% annual rate of return, whereas auto loans yield a 12% annual rate of return. Management has also stipulated that the total amount of homeowner loans should be greater than or equal to 4 times the total amount of automobile loans. Determine the total amount of loans of each type that Madison should extend to each category in order to maximize its returns. housing million dollars automobile million dollars

Answers

Answer 1
Answer:

Answer:

Housing million dollars $1,655.2

Automobile million dollars $413.80

Explanation:

Calculation to determine the total amount of loans of each type

Calculation for HOMEOWNER LOANS

Homeowner loans=$20,000-[(10%*20,000)/(4*12%+10%)]*10%

Homeowner loans=[$20,000-($2,000/48%+10%)]*10%

Homeowner loans=[$20,000-($2,000/58%)]*10%

Homeowner loans=[$20,000-$3,448.3]*10%

Homeowner loans=$16,552*10%

Homeowner loans=$1,655.2

Calculation for AUTO LOANS

Auto Loans=[(10%*20,000)/(4*12%+10%)]*12%

Auto Loans=($2,000/(48%+10%)]*12%

Auto Loans=($2,000/58%)*12%

Auto Loans= $3,448.3*12%

Auto Loans=$413.80

Based on the above calculation Homeowner loans amount of $1,655.2 is 4 times Auto Loans amount of $413.80

Therefore the total amount of loans of each type that Madison should extend to each category in order to maximize its returns are:

Housing million dollars $1,655.2

Automobile million dollars $413.80

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Answers

The best answer would be D. Simple interest is useful for planning parts of your financial future because simple interest is very regular and can be calculated in advance. The equations or the formulas involved are less complex and are easy to understand. However, the amounts calculated are, oftentimes, underestimated.

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The more precisely defined the target market is, the _____ the numbers are to estimate.

Answers

The more precisely defined the target market is, the easier the numbers are to estimate. The clearer the data and information given, the easier it is to predict or estimate other factors that are necessary for the business or industry.

The more precisely defined the target market is, the easier the numbers are to estimate.

Further Explanation:

Market:

Market is the place in which all the goods are sold. The producer sold the goods in the market to reap the profits in the long run.  

Target market:

The target market refers to a type of market in which the company targets a particular number of customers. For example, the company produced jeans for only males and for only a particular geographical area person who belongs to posh society. This is an example of a target market. the company should define the target market in a precise manner. So that the easier the numbers are to estimate. The company can easily estimate the number of products needed and all other estimation.

If the target market is defined comprehensively, then the number of an estimate is longer. In this case, the target market is defined precisely. The number of the estimate cannot be shorter, it depends on the number of units produced. If the target market is defined comprehensively, then the number of an estimate is harder. If the target market is defined precisely, then the number of an estimate is easier. This option is correct.

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Answer details:

Grade: Middle School

Subject: Marketing Management

Chapter: Target Market

Keywords: precisely defined, target market, the easier, numbers are, estimate, longer, targets, particular number, of persons, belongs, to posh, society.  

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Answers

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Answer:

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Answers

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Answers

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Explanation:

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Final answer:

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Answers

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