Answered

Discover the answers you need at Westonci.ca, where experts provide clear and concise information on various topics. Our platform provides a seamless experience for finding reliable answers from a network of experienced professionals. Connect with a community of professionals ready to provide precise solutions to your questions quickly and accurately.

Jane James owns an appliance store. She normally receives $50,000 worth of appliances per month. She does not like to owe people money and always pays her bills on the day she receives the invoice. Someone told her that if she delayed payment, she could actually increase her profit because the money would be earning interest in her account. She went through her bills and found that she actually had an additional ten days, on average to pay her invoices. She also found that she was earning 5 percent interest on the money she had in her money market savings account. If she delayed payment by ten days, how much additional interest would she earn for the year

Sagot :

Answer:

The correct answer is "$820".

Explanation:

Whenever she delays compensation by 10 days a month (even though she receives monthly invoices), she will indeed earn interest for something like a combined amount of 120 days (10 days x 12 months) again for full year of 365 days.

The interest earned will be:

⇒ [tex]50000\times 5 \ percent\times \frac{120}{365}[/tex]

⇒ [tex]50000\times 0.05\times 0.328[/tex]

⇒ [tex]820[/tex] ($)

Thank you for visiting our platform. We hope you found the answers you were looking for. Come back anytime you need more information. We appreciate your time. Please come back anytime for the latest information and answers to your questions. Thank you for trusting Westonci.ca. Don't forget to revisit us for more accurate and insightful answers.