1. Winnebagel Corp. currently sells 18,600 motor homes per year at $27,900 each, and 7,440 luxury motor coaches per year at $52,700 each. The company wants to introduce a new portable camper to fill out its product line; it hopes to sell 11,780 of these campers per year at $7,440 each. An independent consultant has determined that if Winnebagel introduces the new campers, it should boost the sales of its existing motor homes by 2,790 units per year, and reduce the sales of its motor coaches by 558 units per year.
Required :
What is the amount to use as the annual sales figure when evaluating this project?
$129,273,720
$194,890,800
$142,881,480
$87,643,200
$136,077,600
2. Which of the following statements about APR (Annual Percentage Rate) and EAR (Effective Annual Rate) is NOT true?
EAR is usually higher than APR if the compounding frequency is more than annual.
EAR is the real interest rate consumer pays.
APR considers compounding.
Truth-in-lending laws in the U.S. require that lenders disclose an APR on virtually all consumer loans.