BUT asked:


i took out a loan five years ago which ends next month. it was with lloyds for 5000 over 5 years.
they told me that i could’nt have the loan unless i tool out the payment insurance. even though i explained to them that the nature of my work with a construction agency, meant that if i lost my job or i was sick for any length of time the insurance wouldnt pay out any way.
so 5 years on and i’ve got one payment left. i’ve never missed a payment and am still with the same firm. the insurance cost me just over £1100. i can’t help thinking that i was bullied into getting the insurance even though i tried to tell them i didnt want it.

jamad p asked:


You have been working for home-building companies for a number of years. You enjoy construction work, and now you want to start your own home-building company that you will run yourself.

You quit your previous job that had been paying $40,000 per year. You have $40,000 in your savings account that you withdraw to start this company. The savings account had been paying you 5% interest. Because the $40,000 from your savings is not enough to start the company, you also borrow $2,300,000 from the bank. (The bank manager is willing to loan you such a large amount because he knows of your reputation and experience in the home-building industry.) You use the money to hire workers and buy the tools, machinery, and raw materials with which you will build houses.

The cost per worker is $20,000 per year. In your first year, you plan to hire 48 workers to do the construction work, which means that the annual labor cost of your company will be $960,000 (48 x $20,000). With 48 workers, your company can build seven houses.

You must also buy raw materials–land, wood, nails, plasterboard, and so forth. Each house requires $20,000 worth of raw materials. The cost of raw materials for seven houses is $140,000 (7 x $20,000).

Finally, the bank charges 6% interest on your loan. The interest cost is $138,000 (6% of $2,300,000).

1.1. Based on this scenario, what are the total explicit costs for your construction company?

A. $2,300,000

B. $960,000

C. $1,238,000

D. $1,280,000

E. $42,000