A political candidate has asked his/her assistant to conduct a poll to determine the percentage of people in the community that supports him/her. If the candidate wants a 10% margin of error at a 95% confidence level, what size of sample is needed

Answers

Answer 1

Answer:

The desired sample size is 97.

Step-by-step explanation:

Assume that 50% people in the community that supports the political candidate.

It is provided that the candidate wants a 10% margin of error (MOE) at a 95% confidence level.

The confidence interval for the population proportion is:

[tex]CI=\hat p\pm z_{\alpha/2}\sqrt{\frac{\hat p(1-\hat p)}{n}}[/tex]

Then the margin of error is:

[tex]MOE= z_{\alpha/2}\sqrt{\frac{\hat p(1-\hat p)}{n}}[/tex]

Compute the critical value of z as follows:

[tex]z_{\alpha/2}=z_{0.05/2}=z_{0.025}=1.96[/tex]

*Use a z-table.

Compute the sample size as follows:

[tex]MOE= z_{\alpha/2}\sqrt{\frac{\hat p(1-\hat p)}{n}}[/tex]

       [tex]n=[\frac{z_{\alpha/2}\times \sqrt{\hat p(1-\hat p)} }{MOE}]^{2}[/tex]

          [tex]=[\frac{1.96\times \sqrt{0.50(1-0.50)} }{0.10}^{2}\\\\=[9.8]^{2}\\\\=96.04\\\\\approx 97[/tex]

Thus, the desired sample size is 97.


Related Questions

Stefan rode 32.95 miles.
Ben rode 25 4/5 miles. How many more miles did stefan ride than ben?​

Answers

Answer:

7.15 miles

Step-by-step explanation:

4/5 of a mile is equivalent to .8 miles.

32.95

-25.8

7.15

Answer:

Step-by-step explanation:

39.95 - 25.80 = 7.15 miles

Convert the polar equation to an equivalent rectangular equation:

Answers

Answer:

The correct answer will be option b

Step-by-step explanation:

We know that x = rcos( θ ), and y = rsin( θ ), so let's rewrite this polar equation.

r = 4( x / r ) + 2( y / r ),

r = 4x / r + 2y / r,

r = 4x + 2y / r,

r / 1 = 4x + 2y / r ( Cross - Multiply )

4x + 2y = r²

We also know that r² = x² + y², so let's substitute.

x² + y² = 4x + 2y,

x² - 4x - 2y + y² = 0,

Circle Equation : ( x - 2 )² + ( y - 1 )² = ( √5 )²,

Solution : ( x - 2 )² + ( y - 1 )² = 5

Janet has 12 more cookies than Cody. If Janet has 60 cookies, write and solve to determine the number of cookies Cody has.

Answers

Answer:

48

Step-by-step explanation:

Janet - 12 = Cody

60 - 12 = Cody

60 - 12 = 48

The answer to your question is Cody has 48

How do you solve an expansion?

Answers

[tex]\displaystyle\\(a+b)^n\\T_{r+1}=\binom{n}{r}a^{n-r}b^r\\\\\\(x+2)^7\\a=x\\b=2\\r+1=5\Rightarrow r=4\\n=7\\T_5=\binom{7}{4}x^{7-4}2^4\\T_5=\dfrac{7!}{4!3!}\cdot x^3\cdot16\\T_5=16\cdot \dfrac{5\cdot6\cdot7}{2\cdot3}\cdot x^3\\\\T_5=560x^3[/tex]

Answer:

[tex]\large \boxed{560x^3}[/tex]

Step-by-step explanation:

[tex](x+2)^7[/tex]

Expand brackets.

[tex](x+2) (x+2) (x+2) (x+2) (x+2) (x+2) (x+2)[/tex]

[tex](x^2 +4x+4) (x^2 +4x+4) (x^2 +4x+4)(x+2)[/tex]

[tex](x^4 +8x^3 +24x^2 +32x+16)(x^3 +6x^2 +12x+8)[/tex]

[tex]x^7 +14x^6 +84x^5 +280x^4 +560x^3 +672x^2 +448x+128[/tex]

The fifth term is 560x³.

In the following studies, state whether you would use a one-sample t test or a two-independent-sample t test.
A. A study testing whether night-shift workers sleep the recommended 8 hours per day.
B. A study measuring differences in attitudes about morality among Democrats and Republicans.
C. An experiment measuring differences in brain activity among rats placed on either a continuous reward schedule (rewarded every time behavior is exhibited) or an intermittent reward schedule (rewarded after every few times behavior is exhibited).

Answers

Answer:

A) one-sample t-test

B) two sample t-test

C) two sample t-test

Step-by-step explanation: The one - sample t-test is used to determine the existence of a statistical difference between a sample mean and a given population mean. The one sample t test is only capable of making comparison between a singular sample mean and an established value. Such is the case in (A) where the aim is to determine if a group of night workers sleep for 8 hours.

The other two cases however, involves making comparison between the sample means of two different groups, this requires the use of a two independent sample t-test

For a one-sample t test:

(Sample mean - population mean) / standard error.

Sample mean = s

Population mean = p

Sample size = n

For a two sample t-test :

[(s2 - s1) - (p2 - p1)] ÷ √[(sd1^2/n1) + (sd2^2/n2)]

a sample from a mummified bull was taken from a certain place. The sample shows that 71% of the carbon-14 still remains. how old is the sample

Answers

Answer:

Step-by-step explanation:

Decay of carbon - 14 is exponential in nature . It decays as follows .

[tex]N=N_0e^{-\lambda t}[/tex]  λ is called decay constant .

λ = .693 / T where T is half life .

Half life of carbon-14 is 5700 years

λ = .693 / T

= .693 / 5700

= 12.158 x 10⁻⁵ year⁻¹

[tex]N=N_0e^{-\lambda t}[/tex]

N = .71 N₀

[tex].71 N_0 =N_0e^{-\lambda t}[/tex]

[tex].71 =e^{-\lambda t}[/tex]

Taking ln on both sides

ln .71 = - λ t

ln .71 = - 12.158 x 10⁻⁵  t

-0.3425 =  - 12.158 x 10⁻⁵  t

t = .3425 / 12.158 x 10⁻⁵

2817  years .

You are given the sample mean and the population standard deviation. Use this information to construct the​ 90% and​ 95% confidence intervals for the population mean. Interpret the results and compare the widths of the confidence intervals. From a random sample of business​ days, the mean closing price of a certain stock was ​$. Assume the population standard deviation is ​$. The​ 90% confidence interval is ​( nothing​, nothing​). ​(Round to two decimal places as​ needed.) The​ 95% confidence interval is ​( nothing​, nothing​). ​(Round to two decimal places as​ needed.) Which interval is​ wider? Choose the correct answer below

Answers

Complete Question

The  complete question is shown on the first uploaded image

Answer:

The 90% confidence interval is  [tex][108.165 ,112.895][/tex]

The  95%  confidence interval is [tex][107.7123 ,113.3477][/tex]

The  correct option is  D

Step-by-step explanation:

From the question we are told that

    The sample size is  n =  48

     The sample  mean is  [tex]\= x = \$ 110.53[/tex]

    The standard deviation is  [tex]\sigma = \$ 9.96[/tex]

Considering first question

  Given that the confidence level is  90% then the level of significance is mathematically represented as

            [tex]\alpha = (100 - 90)\%[/tex]

           [tex]\alpha = 0.10[/tex]

The  critical value  of  [tex]\frac{\alpha }{2}[/tex] from the  normal distribution table is  

          [tex]Z_{\frac{\alpha }{2} } = 1.645[/tex]

Generally the margin of error is mathematically represented as

            [tex]E = ZZ_{ \frac{x}{y} } * \frac{\sigma}{ \sqrt{n} }[/tex]

             [tex]E = 1.645 * \frac{9.96}{ \sqrt{ 48} }[/tex]

             [tex]E = 2.365[/tex]

The  90% confidence interval is  

       [tex]\= x - E < \mu < \= x + E[/tex]

=>    [tex]110.53 - 2.365 < \mu < 110.53 + 2.365[/tex]

=>    [tex]108.165 < \mu < 112.895[/tex]

Considering second question

  Given that the confidence level is  95% then the level of significance is mathematically represented as

            [tex]\alpha = (100 - 95)\%[/tex]

           [tex]\alpha = 0.05[/tex]

The  critical value  of  [tex]\frac{\alpha }{2}[/tex] from the  normal distribution table is  

          [tex]Z_{\frac{\alpha }{2} } = 1.96[/tex]

Generally the margin of error is mathematically represented as

            [tex]E = Z_{ \frac{x}{y} } * \frac{\sigma}{ \sqrt{n} }[/tex]

             [tex]E = 1.96 * \frac{9.96}{ \sqrt{ 48} }[/tex]

             [tex]E = 2.8177[/tex]

The  95% confidence interval is  

       [tex]\= x - E < \mu < \= x + E[/tex]

=>    [tex]110.53 - 2.8177 < \mu < 110.53 + 2.8177[/tex]

=>    [tex]107.7123 < \mu < 113.3477[/tex]

Lines a and b are parallel. If the slope of line a is , what is the slope of line b?



A.
-

B.
4

C.


D.
-4

Answers

Answer:

C. 1/4

Step-by-step explanation:

Parallel lines always have the same slope.

Answer:

  C.  1/4

Step-by-step explanation:

Parallel lines have the same slope. If line b is parallel to line a, and line a has slope 1/4, then line b has slope 1/4.

Help me please thank you

Answers

Step-by-step explanation:

To solve for x, we set up our equation like this:

7x - 7 = 4x + 14

Next, we subtract 4x from the right side to cancel it out and then subtract 4x from the left side.

7x (-4x) - 7 = 4x (-4x) + 14

3x - 7 = 14

Then, we add 7 on both sides (to cancel the -7 out and place it on the right)

3x - 7 (+7) = 14 + 7

3x = 21

Finally, we divide both sides by 3 to isolate our variable, x.

3x ÷ 3 = x

21 ÷ 3 = 7

Our final answer: x = 7

Factor quadratic plz 15x^2-4x-4=

Answers

Answer:

x = 2/3 or x = -2/5

Step-by-step explanation:

15x^2 - 4x - 4 = ?

factor the left side of the expression and set factors equal to zero:

(3x-2)(5x+2)=0

3x - 2 =0 or 5x + 2 =0

3x =2 or 5x = -2

x = 2/3 or x = -2/5

Which describes the translation of f(x) to g(x)? translation of four units up translation of five units up translation of four units to the right translation of five units to the right

Answers

Answer:

Option (1)

Step-by-step explanation:

Given question is incomplete; find the picture of the graph in the attachment.

Parent function f(x) = [tex]\frac{1}{2^x}[/tex]

When function 'f' is translated by 4 units up which is evident form the graph, the translated function obtained is,

g(x) = f(x) + 4

g(x) = [tex]\frac{1}{2^x}+4[/tex]

Therefore, Option (1). [Translation of 4 units up] is defined by the graph attached.

Answer:

Option (1)

Step-by-step explanation:

While walking from the car into your dormitory you dropped your engagement ring somewhere in the snow. The path is 30 feet long. You are distraught because the density of its location seems to be constant along this 30-foot route. a) What is the probability that the ring is within 12 feet of your car

Answers

Answer:

0.4

Step-by-step explanation:

we are required to find the probability that the ring is within 12 meters from nthe car.

we start by defining a random variable x to be the distance from the car. the car is the starting point.

x follows a normal distribution (0,30)

[tex]f(x)=\frac{1}{30}[/tex]

[tex]0<x<30[/tex]

probabilty of x ≤ 12

= [tex]\int\limits^a_ b{\frac{1}{30} } \, dx[/tex]

a = 12

b = 0

[tex]\frac{1}{30} *(12-0)[/tex]

[tex]\frac{12}{30} = 0.4[/tex]

therefore 0.4 is the probability that the ring is within 12 feet of your car.

Officer Jacobi drove 180 miles in his patrol car during part of May. The distance represents 40% of May. How many miles did he drive all of May? a) 710 miles b) 420 miles c) 720 miles d) 450 miles Need Help on How to work this problem out, what formula would I use?

Answers

Answer:

D: 450 miles

Step-by-step explanation:

So we know that Officer Jacobi drove 180 miles, which represents 40% of the total distance driven. In other words, 40% of the total distance traveled is 180. Thus (let D be the total distance traveled):

[tex]0.4D=180[/tex]

This equation is basically saying that 40% (0.4) of the total distance driven is 180 miles. To solve for the total distance D, we can divide both sides by 0.4. Thus:

[tex]0.4D=180\\D=450[/tex]

So the answer is D or 450 miles.

Note that there isn't a specific formula you would use. These types of problems require you to write out an equation yourself.

Answer: 450 miles


Explanation: When doing percentages, we can use the proportion is/over=%/100.

If we apply this to your problem, we can say 180 miles “is” 40% “of” x (x is the total number of miles driven in May.

Plugging in numbers for is, of, and the % gives us 180/x=40/100

Solving with cross multiplying and dividing gives us 450 miles=x

what are the like terms of the expression.
3x+8x+y+x+8

Answers

Answer:

the like terms are:

3x+8x+x+y+8

12x+y+8

Answer:

The like terms are

3x, 8x, x

Step-by-step explanation:

3x+8x+y+x+8

The like terms are

3x, 8x, x

They are the terms that are in terms of the first power of x

A sports club was formed in the month of May last year. The function below, M(t), models the number of club members for the first 10 months, where t represents the number of months since the club was formed in May. m(t)=t^2-6t+28 What was the minimum number of members during the first 10 months the club was open? A. 19 B. 28 C. 25 D. 30

Answers

Answer:

A: 19

Step-by-step explanation:

For this, we can complete the square. We first look at the first 2 terms,

t^2 and -6t.

We know that [tex](t-3)^2[/tex] will include terms.

[tex](t-3)^2 = t^2 - 6t + 9[/tex]

But [tex](t-3)^2[/tex] will also add 9, so we can subtract 9. Putting this into the equation, we get:

[tex]m(t) = (t-3)^2 - 9 +28[/tex]

[tex]m(t) = (t-3)^2 +19[/tex]

Using the trivial inequality, which states that a square of a real number must be positive, we can say that in order to have the minimum number of members, we need to make (t-3) = 0. Luckily, 3 months is in our domain, which means that the minimum amount of members is 19.

A researcher is interested in finding a 95% confidence interval for the mean number of times per day that college students text. The study included 210 students who averaged 28 texts per day. The standard deviation was 21 texts.A. The sampling distribution follows a_______.1. "F"2. "normal"3. "T"4. "Chi-square" B. With 95% confidence the population mean number of texts per day of is between_______and______texts. A. 1. "24.92"2. "25.79"3. "27.37"4. "25.14"B. 1. "31.19"2. "31.20"3. "29.28"4. "30.86" C. If many groups of 210 randomly selected students are studied, then a different confidence interval would be produced from each group. About_______% of these confidence intervals will contain the true population mean number of texts per day and about______% will not contain the true population mean number of texts per day.A. 1. "5"2. "95"3. "1"4. "99"B. 1. "95"2. "99"3. "5"4. "1"

Answers

Answer: A. The sampling follows a normal distribution.

              B. Between 25.14 and 30.86

              C. About 95% will contain the true mean and about 5% won't

Step-by-step explanation: A. The sampling is normally distributed because:

it has a symmetric bell shape, mean and median are both the same and located at the center of graphic, approximately 68% of the data falls within one standard deviation;95% falls within two standard deviations;99.7% within 3 standard deviations;

B. For a 95% confidence interval: α/2 = 0.025

Since n = 210, use z-score = 1.96

To calculate the interval:

mean ± [tex]z.\frac{s}{\sqrt{n} }[/tex]

Replacing for the values given:

28 ± [tex]1.96.\frac{21}{\sqrt{210} }[/tex]

28 ± [tex]1.96*1.45[/tex]

28 ± 2.84

lower limit: 28 - 2.84 = 25.14

upper limit: 28 + 2.84 = 30.86

Confidence Interval is between 25.14 and 30.86.

C. Confidence Interval at a certain percentage is an interval of values that contains the true mean with a percentage of confidence. In the case of number of times per day students text, 95% of the interval will contain the true mean, while 5% will not contain it.

Which value is a solution to w∕18 ≥ –1?

Answers

Answer:

w ≥ -18

Step-by-step explanation:

Answer:

w is greater than or equal to-18

A low-noise transistor for use in computing products is being developed. It is claimed that the mean noise level will be below the 2.5-dB level of products currently in use. It is believed that the noise level is approximately normal with a standard deviation of .8. find 95% CI

Answers

Answer:

The 95% CI is   [tex]2.108 < \mu < 2.892[/tex]

Step-by-step explanation:

From the question we are told that

   The  population mean [tex]\mu = 2.5[/tex]

    The standard deviation is  [tex]\sigma = 0.8[/tex]

Given that the confidence level is  95% then the level of confidence is mathematically evaluated as

          [tex]\alpha = 100 - 95[/tex]

   =>  [tex]\alpha = 5\%[/tex]

  =>    [tex]\alpha = 0.05[/tex]

Next we obtain the critical value of  [tex]\frac{\alpha }{2}[/tex] from the normal distribution table, the values is  [tex]Z_{\frac{\alpha }{2} } = 1.96[/tex]

Generally the margin of error is mathematically evaluated as

          [tex]E = Z_{\frac{\alpha }{2} } * \frac{\sigma}{\sqrt{n} }[/tex]

here we would assume that the sample size is  n =  16 since the person that posted the question did not include the sample size

  So    

               [tex]E = 1.96* \frac{0.8}{\sqrt{16} }[/tex]

               [tex]E = 0.392[/tex]

The  95% CI is mathematically represented as

              [tex]\= x -E < \mu < \= x +E[/tex]

substituting values

              [tex]2.5 - 0.392 < \mu < 2.5 + 0.392[/tex]

substituting values

              [tex]2.108 < \mu < 2.892[/tex]

       

Answer gets BRAINLIEST If q varies inversely as r, and g = 10 when r = 2.5, find the equation that connects a
and r.

Answers

Answer:

D.

Step-by-step explanation:

In direct variations, we would have:

[tex]q=kr[/tex]

Where k is some constant.

Since this is indirect variation, instead of that, we would have:

[tex]q=\frac{k}{r}[/tex]

To determine the equation, find k by putting in the values for q and r:

[tex]10=\frac{k}{2.5}\\k=2.5(10)=25[/tex]

Now plug this back into the variation:

[tex]q=\frac{25}{r}[/tex]

The answer is D.

You’ve been contracted to wallpaper a wall 10 feet wide and 12 feet high with a square window with 3 foot sides. How many square feet of wallpaper do you need to cover the wall if you were to exclude the opening for the window? _____ square feet

Answers

Answer:

111 ft²

Step-by-step explanation:

wall: 10 x 12 = 120

window: 3 x 3 = 9

wall - window = area to wallpaper

120 - 9 = 111

111 ft²

Answer:

111 sq ft

Step-by-step explanation:

wall: 10 x 12 = 120

window: 3 x 3 = 9

wall - window = area to wallpaper

120 - 9 = 111

111 ft²

Please help ! I’ll mark you as brainliest if correct.

Answers

Answer:

D = -87Dx = 174Dy = -435Dz = 0(x, y, z) = (-2, 5, 0)

Step-by-step explanation:

The determinant of the coefficient matrix is ...

  [tex]D=\left|\begin{array}{ccc}2&5&3\\4&-1&-4\\-5&-2&6\end{array}\right|\\\\=2(-1)(6)+5(-4)(-5)+3(4)(-2)-2(-4)(-2)-5(4)(6)-3(-1)(-5)\\\\=-12+100-24-16-120-15=\boxed{-87}[/tex]

The other determinants are found in similar fashion after substituting the constants on the right for each of the above matrix columns, in turn.

Those determinants are ...

  [tex]D_x=\left|\begin{array}{ccc}21&5&3\\-13&-1&-4\\0&-2&6\end{array}\right|=174[/tex]

  [tex]D_y=\left|\begin{array}{ccc}2&21&3\\4&-13&-4\\-5&0&6\end{array}\right|=-435[/tex]

  [tex]D_z=\left|\begin{array}{ccc}2&5&21\\4&-1&-13\\-5&-2&0\end{array}\right|=0[/tex]

The solutions are ...

  x = 174/-87 = -2

  y = -435/-87 = 5

  z = 0

That is, (x, y, z) = (-2, 5, 0).

Solve the inequality -3 < 3/2(2-x)<5

Answers

Answer:

Step-by-step explanation:

convert 8 7/9 yard into in

Answers

Answer:

316.08 inches

Step-by-step explanation:

There are 3 feet in a yard, and there is 12 inches in 1 foot, so there are 36 inches in one yard. If there is 8 7/9 yards it is the same at 8.78 yards, and  8.78 x 36 = 316.08 inches. Therefore 8 7/9 yards = 316.08 inches.

Consider the following. (Assume that the coins are distinguishable and that what is observed are the faces or numbers that face up.) Three coins are tossed; the result is at most one head. Which of the following sets of elements are included in the sample space
HHTHTTTTHTTTTHTHHHTHHHTH
List the elements of the given event. (Select all that apply.)
HHT
HTT
TTH
TTT
THT
HHH
THH
HTH
List the elements of the given event. (select all that apply)
HTT
TTH
HTH
THH
THT
HHH
TTT
HHT

Answers

Answer:

Even set = {HTT, THT, TTH, TTT}

Step-by-step explanation:

We are given that three coins are tossed; the result is at most one head.

And we have to find the sets of elements that are included in the sample space.

Firstly, as we know that when three coins are tossed, the total number of cases formed is 8.

Let Head on the coin be represented by 'H' and the Tail on the coin be represented by 'T'.

So, the sample space so formed is;

S = {HHH, HTH, HHT, THH, THT, TTH, HTT, TTT}

Now, our event is at most one head. So, the sample space for the favorable event is given by;

Even set = {HTT, THT, TTH, TTT}

In this, three cases are of head occurring only once and one case is of head not appearing in three tosses of a coin.

How many multiples of 4, that are smaller than 1,000, do not contain any of the digits 6, 7, 8, 9 or 0? I really need a answer.

Answers

Answer:

Step-by-step explanation:

We could start by listing multiples of 4 and looking for patterns. Do  

you know what a multiple of a number is?  It's that number multiplied  

by another number. So the first multiple of 4 is 4x1, the second  

multiple of 4 is 4x2=8, the third multiple of 4 is 4x3=12, etc.  

Let's make a table of multiples of 4 from 1 to 100, with columns A-E  

across the top and rows 1-5 down the left-hand side:

    A      B      C      D      E

1    4      8     12     16     20

2   24     28     32     36     40

3   44     48     52     56     60

4   64     68     72     76     80

5   84     88     92     96    100

Now let's look at these multiples, remembering that there will be nine  

more tables like this one from 101-1000.

Let's look for 6,7,8,9, and 0 in the columns first. Aha! We can erase  

all of columns B, D, and E because there's a 6 or an 8 or a 0 in each  

number in those columns.  Now we're left with just:

    A      C  

1    4     12  

2   24     32  

3   44     52  

4   64     72  

5   84     92  

Now let's look at the rows. Wow! We can eliminate rows 4 and 5 because  

they have 6, 7, 8, or 9, leaving:

    A      C  

1    4     12  

2   24     32  

3   44     52  

Just 6 numbers left!

So if from 1-100 there are 6 multiples of four that do not contain any  

of the digits 6, 7, 8, 9, or 0, how many multiples of four like this  

are there from 1-1000?

The hypotenuse of a right triangle is 14 in. If the base
of the triangle is 2 inches determine the
length of the remaining side.
14 in
Х
2 in
O A &
B. 318
O c. 8v3
OD. 112

Answers

Answer:

13.85

Step-by-step explanation:

U use the pythagorean theorem

So 2^2 + x^2 = 14^2

Simplify the equation: 4+x^2=196

--> x^2=192

--> x=13.85

-Hope this helps :)

9514 1404 393

Answer:

  c.  8√3

Step-by-step explanation:

The Pythagorean theorem applies.

  14² = s² + 2²

  s = √(14² -2²) = √192 = 8√3

The length of the remaining side is 8√3.

A salesperson earns $99 per day, plus a 9% sales commission. Find a function that
expresses her earnings as a function of sales, and use it to compute her earnings if the
total sales were $999. The salesperson would take home $___ for the day?
$188.00
$188.91
$188.99
$189.99

Answers

Answer:

$188.91

Step-by-step explanation:

$999*.09=$89.91

$89.91+$99=$188.91

Using minutes as the unit of measurement on the left-hand side of a constraint and using hours on the right-hand side is acceptable since both are a measure of time.

a. True
b. False

Answers

Answer:

True

Step-by-step explanation:

Solve the following equation algebraically:
3x^2=12

a.+3
b. +2
C.+3.5
d. +1.5

Answers

3x^2=12
(3x)^2 =12
9x^2= 12
X= 1.5

Answer:

Step-by-step explanation:

answer is c just took test

Assume a bank loan requires an interest payment of $85 per year and a principal payment of $1,000 at the end of the loan's eight-year life. What would be the present value of this loan if it carried a 10% interest rate?

Answers

Answer:

The present value is  [tex]PV = \$ 396,987[/tex]

Step-by-step explanation:

From the question we are told that

   The  interest payment per year is  [tex]C = \$ 85[/tex]

    The principal payment is  [tex]P = \$ 1000[/tex]

     The  duration is  n =  8   years

      The  interest rate is  [tex]r = 10\% = 0.10[/tex]

The present value is  mathematically represented as

      [tex]PV = [ \frac{C}{r} * [1 - \frac{1 }{ (1 +r)^n} ] + \frac{P}{(1 + r)^n} ][/tex]

substituting values

      [tex]PV = [ \frac{85}{0.10} * [1 - \frac{1 }{ (1 +0.10)^8} ] + \frac{1000}{(1 + 0.10)^ 8} ][/tex]

      [tex]PV = \$ 396,987[/tex]

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