Money planning

Full Answer Section

• The net value is the difference between the stock broker account and the combine harvester loan debt.
• There are no changes to either account during the year: no payments on the loan and no deposits or withdrawals from the stock broker account.
• Therefore, the difference between the two accounts, which is the net value, stays the same.

So, even though the individual values of the stock broker account and the loan debt remain unchanged, their difference (the net value) also remains constant at $4000.

Sample Solution

Here's why:

• The net value is the difference between the stock broker account and the combine harvester loan debt.
• There are no changes to either account during the year: no payments on the loan and no deposits or withdrawals from the stock broker account.
• Therefore, the difference between the two accounts, which is the net value, stays the same.