Alden Trucking Company is replacing part of its fleet of trucks by purchasing them under a note agreement with Kenworthy on January 1, 2019. Alden financed $37,908,000, and the note agreement will require $10 million in annual payments starting on December 31, 2019 and continuing for a total of four more years (final payment December 31, 2023). Kenworthy will charge Alden Trucking Company the market interest rate of 10% compounded annually. Upon the first payment of the note on December 31, 2019, the amount of interest expense to be recorded is:

The multiple choices are:

A. $1,000,000.

B. $2,790,800.

C.$3790, 800.

D.$4,000,000

The correct optio is C,$3790, 800.

Explanation:

The interest expense on the loan is usually the opening balance multiplied by the market rate interest which is 10% in this question.

In addition,we can deduct the annual repayment in order to know the closing balance of the loan.

Year   opening bal                interest expense at10% repayment   closing bal.

2019    $37,908,000      $3,790,800                $4,000,000

The closing balance is $37,908,000+  $3,790,800-$4000,000

The interest expense is 10% of the present value of $37.908,000 that is  $ 3,790,800.00  

the correct answer is economics is a game without winners or losers.

unlike sports or games economic is a game without losers or winner rather it is a game where everyone wins. parties of business doing businesses exchange money with each other and hence exchange is done on the basis of goods. one party takes the goods and other sales it so there is winner on both sides. each party values more highly the good it gets than the good it gives up. both sides exchange only because both intend to increase their value. so there is no concept of lose or win.

a manufacturer of printed circuit boards uses exponential smoothing with trend to forecast monthly demand of its product. at the end of december, the company wishes to forecast sales for january. the estimate of trend through november has been 200 additional boards sold per month. average sales have been around 1000 units per month. the demand for december was 1100 units. the company uses α = 0.20 and β = 0.10. make a forecast including trend for the month of january.