1. A loan of $46,000 is paid off in 36 payments at the end of each month in the following way:
Payments of $1150 are made at the end of the month for the first 12 months.
Payments of $1150 + x are made at the end of the month for the second 12 months.
Payments of $1150 + 2x are made at the end of the month for the last 12 months.
What should x be if the nominal monthly rate is 9.2%?
2. Which of the statements is true about the values recorded in the balance sheet of a firm?
The book values of a firm's liabilities will be higher than the market values of the firm's liabilities.
The book values of a firm's assets will be higher than the market values of the firm's assets.
The book values of a firm's assets will be equal to the market values of the firm's assets.
The equity section of a firm's liability represents the difference between the market value of the firm's assets and the market value of the firm's liabilities.
The book values of a firm's debt will be very close to the market values of the firm's liabilities.